South Korean Shares Extend Losses

The benchmark KOSPI fell more than 1% to around 6,620 on Monday, extending losses from the previous session as weakness in US technology stocks continued to weigh on investor sentiment. The decline followed another selloff on Wall Street, with investors staying cautious ahead of major US technology earnings and this week's Federal Reserve policy decision, which could offer fresh clues on AI spending and interest rates. Samsung Electronics (-0.7%), SK Hynix (-1.4%), SK Square (-4.9%), Hyundai Motor (-1.1%), and Hanwha Aerospace (-7.7%) were among the notable decliners. Meanwhile, easing geopolitical tensions after the US paused strikes on Iran over the weekend pushed oil prices sharply lower and improved global risk sentiment. Markets also found support from a series of AI cooperation agreements between South Korean firms and global technology companies, including a long-term semiconductor supply deal involving SK Group and Nvidia, as well as Nvidia's investment in Naver.

The benchmark KOSPI slipped 5.72% to close at 6,691 on Friday, snapping a three-day rally as a selloff in technology stocks weighed on investor sentiment. South Korean chipmakers declined sharply following a selloff in major US technology companies, which raised concerns that slowing returns from heavy AI investments could weaken demand expectations for semiconductor suppliers. Samsung Electronics and SK hynix dropped 7.59% and 8.29%, respectively, alongside losses in SK Square (-9.01%), Hyundai Motor (-7.99%), and LG Energy Solution (-4.89%). At the same time, Brent crude climbed above $100 per barrel amid escalating Middle East tensions, fueling concerns over energy supply disruptions and prompting a broader risk-off move across global markets. Foreign investors sold around KRW 1.6 trillion worth of Korean equities, further weighing on sentiment. Separately, new US tariff measures on South Korea and other trading partners added to uncertainty over the export outlook.

The benchmark KOSPI rose 4.40% to close at 7,097 on Thursday, rallying for a third straight session as technology stocks advanced. Investor sentiment was buoyed by renewed optimism over artificial intelligence after Alphabet reported better-than-expected quarterly revenue, driven by strong cloud growth, and raised its capital spending outlook to support booming AI demand. The results reinforced expectations of sustained investment in AI infrastructure, boosting South Korean semiconductor shares. Samsung Electronics and SK Hynix advanced 3.65% and 4.21%, respectively, alongside gains in Samsung Electro-Mechanics (7.51%), Hyundai Motor (2.75%), and LG Energy Solution (8.72%). Separately, South Korea's economy expanded 0.6% in the second quarter, beating the Bank of Korea's 0.2% forecast as robust semiconductor exports and resilient private consumption supported growth. Meanwhile, Middle East tensions remained in focus after renewed US-Iran hostilities pushed oil prices higher.