South Korean Shares Pause Four-Day Rally

The benchmark KOSPI edged down to around 8,710 on Wednesday, pausing a four-day rally, as weakness in global technology stocks and caution ahead of the Federal Reserve's policy decision weighed on sentiment. Semiconductor shares came under pressure after a selloff in US AI-related stocks, with market heavyweight Samsung Electronics declining and weighing on the broader index. Losses were also seen in Hyundai Motor (-3.9%), Kia Corporation (-2.2%), Hyundai Mobis (-4.1%), and KB Financial Group (-1.7%). Investors also remained wary ahead of the first Federal Open Market Committee meeting under Fed Chair Kevin Warsh, amid concerns that policymakers could signal a more hawkish stance despite expectations that interest rates would remain unchanged. Meanwhile, easing tensions in the Middle East and receding oil-price pressures supported risk appetite and helped limit losses.

The benchmark KOSPI rose 2.11% to close at 8,727 on Tuesday, extending gains for a fourth straight session as easing tensions in the Middle East and lower oil prices supported sentiment. The move came after the US and Iran signed a preliminary agreement aimed at ending their conflict, with the Strait of Hormuz set to reopen later this week and remain toll-free during a 60-day ceasefire period, easing concerns over global energy supplies and shipping disruptions. Oil prices fell sharply on the news, reducing inflation concerns for South Korea, with data showing import prices fell for a second straight month in May amid lower crude oil costs. Semiconductor shares tracked overnight gains on Wall Street, supporting chipmakers. Samsung Electronics (1.34%) and SK hynix (3.85%) led the advance, along with SK Square (6.16%), Hanwha Aerospace (9.59%), Hyundai Mobis (3.44%), Doosan Enerbility (3.81%), and Kia Corporation (1.49%).

The benchmark KOSPI climbed 5.20% to close at 8,546 on Monday, extending gains for a third straight session as a US-Iran peace agreement boosted risk appetite. Washington and Tehran reached a deal to end their monthslong conflict and reopen the Strait of Hormuz, with a formal signing ceremony expected later this week, easing concerns over global energy supplies and sending oil prices sharply lower. The rally was broad-based, with technology and cyclical stocks leading gains as investors returned to risk assets. Samsung Electronics (4.34%) and SK Hynix (6.28%) led the advance, along with SK Square (3.09%), Hyundai Motor (5.93%), LG Energy Solution (5.00%), HD Hyundai Heavy Industries (9.08%), Doosan Enerbility (7.09%), and KB Financial Group (5.21%). Additional support came from strong domestic fundamentals, with South Korea's ICT exports reaching a record high in May, driven by surging semiconductor shipments and sustained AI-related demand.