South Korean Shares Rise on Chip Gains

The benchmark KOSPI rose nearly 1% to around 6,930 on Wednesday, snapping a two-day decline as gains in US semiconductor shares lifted Korean chipmakers. The Philadelphia Semiconductor Index rose 1.3% overnight, while Samsung Electronics and SK hynix gained about 0.5% and 2.7%, respectively, reflecting renewed demand for major technology stocks. Other notable performers included SK Square (2.9%), Doosan Enerbility (2.5%), and HD Hyundai Heavy Industries (2.1%). The index was also on track to gain over 1% in September. Meanwhile, elevated US Treasury yields limited the advance, with the 10-year yield near its highest level since 2007 and the 30-year yield at its highest level since 2002, keeping borrowing costs elevated for technology stocks. Additionally, Samsung Electronics and SK hynix could complete their combined KRW 55 trillion buybacks by mid-October, earlier than the previously expected late-November timeline, potentially removing an important source of KOSPI demand.

The benchmark KOSPI edged down 0.27% to close at 6,871 on Tuesday, extending losses from the previous session as higher oil prices and Treasury yields weighed on risk appetite. The US 10-year Treasury yield climbed above 5.2%, while the 30-year yield rose above 5.5%, both reaching multi-year highs as renewed Middle East tensions raised concerns about persistent inflation and further interest-rate increases. At the same time, Wall Street closed lower overnight, with the S&P 500, Dow Jones, and Nasdaq all falling nearly 1%. Losses were recorded in LG Energy Solution (-3.30%), Hyundai Motor (-1.55%), Hanwha Aerospace (-2.22%), and Doosan Enerbility (-2.93%). Additionally, weaker domestic business sentiment added to the cautious tone, with the BOK’s business sentiment index falling for the first time in three months in September, while manufacturing sentiment recorded a sharper decline amid concerns over fewer working days, raw material costs, and external uncertainties.

The benchmark KOSPI fell 2.70% to close at 6,890 on Monday, reversing gains from the previous session amid renewed uncertainty over the Middle East and higher oil prices. Brent crude rose above $105 a barrel after the US rejected Iran’s conditional proposal concerning the Strait of Hormuz. Additionally, the 10-year US Treasury yield remained near its highest level since July 2007, raising concerns over tighter global financial conditions and further rate hikes. Investors took profits in large-cap technology stocks, with Samsung Electronics and SK hynix declining 4.73% and 4.56%, respectively, along with losses in SK Square (-7.56%), Samsung C&T (-5.72%), SK Inc (-4.91%), and Hyosung Heavy Industries (-4.01%). Meanwhile, strong semiconductor earnings prospects provided some offset, with Samsung Electronics expected to post more than KRW 100 trillion in third-quarter operating profit and the semiconductor sector’s business sentiment reaching a record high for the fourth quarter.