South Korean Shares Close Higher

The benchmark KOSPI rose 0.68% to close at 6,743 on Tuesday, rebounding from the previous session as retail and institutional investors stepped in to buy Korean shares. Large-cap performance was mixed, with SK hynix rising 0.42%, along with Hyundai Motor (1.69%), KB Financial Group (2.02%), and Kia Corporation (2.59%), while Samsung Electronics was flat and SK Square (-1.49%) and LG Energy Solution (-3.45%) posted losses. Investors looked ahead to Nvidia’s earnings report for clues on the outlook for AI-related investments, while concerns over the profitability of AI spending continued to weigh on technology stocks. Foreign investors remained net sellers, offloading KRW 3.82 trillion, while individuals and institutions bought KRW 1.0 trillion and KRW 1.17 trillion, respectively. Meanwhile, sentiment was tempered by geopolitical tensions in the Middle East and uncertainty over the US monetary policy outlook ahead of Fed Governor Kevin Warsh’s speech at Jackson Hole on Friday.

The benchmark KOSPI fell nearly 2% to around 6,570 on Tuesday, extending losses for a second straight session, as a selloff in global technology shares weighed on Korean chipmakers. Samsung Electronics and SK hynix fell more than 3% and 6%, respectively, amid renewed concerns over the profitability of AI-related investments ahead of Nvidia’s earnings report, while reports that US officials were pressing Korean chipmakers to expand investment in American production facilities added to the sector’s weakness. Samsung’s disappointing shareholder-return plan also weighed on the market after its shares plunged on Monday, as investors had expected a larger payout and clearer plans for share buybacks and cancellations. Other notable declines included SK Square (-6.7%), LG Energy Solution (-3.3%), and Hyundai Mobis (-2.3%). Attention now turned to the Bank of Korea’s policy meeting on Thursday, with markets expecting another 25-basis-point rate hike to 3.00% following last month’s 2.75%.

The benchmark KOSPI fell 3.12% to close at 6,697 on Monday, reversing gains from the previous session, as investors took profits in chip stocks ahead of Nvidia's earnings this week. Samsung Electronics plunged 8.35%, while SK hynix slipped 2.60%, as investors remained cautious about the outlook for the AI-driven semiconductor rally. Additionally, rising global bond yields pressured equities, with the US 30-year Treasury yield reaching its highest level in nearly 20 years. Renewed Middle East tensions also pushed Brent crude toward $90 per barrel, raising concerns over higher inflation and keeping pressure on global risk appetite. Losses were also seen in SK Square (-4.10%), Samsung C&T Corp (-7.71%), KB Financial Group (-0.79%), and SK Inc (-6.31%). Meanwhile, Samsung Electronics' record shareholder-return plan to return up to KRW 110 trillion for shareholders this year, including KRW 30 trillion in third-quarter dividends, follows SK hynix's KRW 40 trillion buyback.