South Korean Shares Rebound on Chip Rally

The benchmark KOSPI rose more than 2% to around 7,420 on Thursday, rebounding from an over one-month low of about 7,250 as heavyweight semiconductor stocks advanced. Sentiment was boosted after reports that SK hynix's planned US ADR offering was more than seven times oversubscribed, reflecting strong investor demand for the AI memory chipmaker. Samsung Electronics and SK hynix climbed more than 3% and 7%, respectively, after suffering sharp declines a day earlier, helping drive the broader market higher. Other gainers included SK Square (5.7%), LG Energy Solution (3.8%), Doosan Enerbility (3.5%), and SK Inc. (3.5%). Additionally, sentiment was supported after the Asian Development Bank raised South Korea's 2026 growth forecast to 2.6% from 1.9%, citing robust global AI demand and strong semiconductor exports as key drivers of economic growth. Meanwhile, renewed US-Iran tensions kept investors cautious as higher oil prices fueled inflation concerns and weighed on global risk appetite.

The benchmark KOSPI fell 5.35% to close at 7,247 on Wednesday, hitting its lowest level in over a month as a broad sell-off in semiconductor stocks followed overnight losses on Wall Street. Chipmakers came under pressure after investors questioned the sustainability of the AI-driven spending boom despite Samsung Electronics' strong quarterly earnings, dragging global semiconductor shares lower. Investors also remained cautious as escalating tensions in the Middle East boosted oil prices and dampened global risk appetite following fresh US strikes on Iran and attacks near the Strait of Hormuz. Losses were led by Samsung Electronics (-5.91%), SK Hynix (-5.00%), SK Square (-6.27%), HD Hyundai Heavy Industries (-7.07%), Hanwha Aerospace (-8.20%) and Doosan Enerbility (-9.44%). Meanwhile, South Korean authorities said they would closely monitor risks to market stability as heightened volatility in heavyweight chip stocks and single-stock leveraged ETFs continued to fuel sharp market swings.

The benchmark KOSPI fell 4.91% to close at 7,656 on Tuesday, extending losses from the previous session as investors took profits in heavyweight technology stocks following a strong AI-driven rally. Technology shares remained under pressure as investors grew more cautious toward the AI trade amid recent weakness in global semiconductor stocks and concerns over whether robust earnings can justify lofty valuations. Samsung Electronics (-7.23%) tumbled despite reporting record preliminary second-quarter earnings that beat expectations, with the strong results largely seen as priced in, while SK Hynix (-6.40%) declined ahead of its planned US listing. Additionally, battery stocks weakened after LG Energy Solution (-7.05%) posted quarterly operating profit well below forecasts, reinforcing concerns over sluggish global EV demand. Other major decliners included SK Square (-10.03%), Hyundai Motor (-5.38%), HD Hyundai Heavy Industries (-5.83%), Hanwha Aerospace (-3.80%), and Kia Corp (-4.92%).