South Korean Shares Rally on US-Iran Deal Hopes

The benchmark KOSPI rose more than 3% to around 6,580 on Wednesday, extending gains from the previous session as hopes for a US-Iran agreement boosted risk appetite. Optimism that Washington and Tehran could reach a deal to reopen the Strait of Hormuz drove oil prices sharply lower, easing concerns over energy supply disruptions and inflation. The improvement in global sentiment lifted Wall Street to record highs overnight, with technology shares leading the advance after strong earnings from major US companies renewed confidence in AI-related spending, fueling a rebound in semiconductor stocks. Samsung Electronics gained more than 2%, while SK Hynix surged over 5%. Other notable performers included SK Square (5.3%), Hyundai Motor (3.1%), LG Energy Solution (2.3%), Kia Corporation (2.0%), and HD Hyundai Heavy Industries (2.9%).

The benchmark KOSPI rose 1.62% to close at 6,359 on Tuesday, recovering part of the previous session's losses as investors returned to beaten-down stocks. Overnight gains on Wall Street also supported sentiment, with strong earnings from Amazon and advances in major AI-related technology stocks boosting risk appetite. Samsung Electronics and SK hynix edged higher by 0.21% and 0.64%, respectively, while other gainers included SK Square (3.41%), LG Energy Solution (3.96%), HD Hyundai Heavy Industries (2.66%), and Hanwha Aerospace (9.25%). Meanwhile, investors remained cautious amid lingering uncertainty over AI-related valuations following the recent tech-led selloff. Conflicting signals over US-Iran negotiations also capped broader gains. Separately, South Korea's softer-than-expected inflation eased immediate price concerns, though firmer core inflation reinforced expectations for a cautious Bank of Korea policy stance.

The benchmark KOSPI edged down to around 6,230 on Tuesday, extending losses for a second straight session, as technology heavyweights remained under pressure. Samsung Electronics and SK Hynix both fell more than 3%. Other notable losses included Hyundai Motor (-3.3%), Samsung Electro-Mechanics (-3.6%), KB Financial Group (-0.7%), Kia Corporation (-1.4%), Shinhan Financial Group (-1.6%), and Hyundai Mobis (-5.1%). Meanwhile, South Korea's annual inflation rate eased to 2.8% in July from 3.2% in June, below market expectations of 3.0%, though a pickup in core inflation reinforced expectations that the Bank of Korea will maintain a restrictive monetary policy stance. Investors also monitored developments in the Middle East after US President Donald Trump said talks with Iran on reopening the Strait of Hormuz were underway, while uncertainty over the outcome of the negotiations kept risk appetite in check.