South Korean Shares Snap 3-Day Decline

The benchmark KOSPI rose 1.95% to close at 6,971 on Thursday, snapping a three-day slide as gains in semiconductor-related stocks helped lift the index. Micron Technology’s stronger-than-expected results and upbeat revenue guidance highlighted continued demand for AI memory chips, while its increased long-term supply commitments reinforced the positive outlook for the sector. Samsung Electronics and SK hynix climbed 2.61% and 3.10%, respectively, along with gains in SK Square (1.32%), Hanwha Aerospace (2.78%), LG Energy Solution (0.98%), and Samsung Electro-Mechanics (2.95%). Additionally, South Korea’s September exports surged 83.5% year-on-year to a record $120.9 billion, led by semiconductor exports that jumped 263% to a record $60.3 billion, further underscoring robust chip demand. Meanwhile, elevated US Treasury yields remained an offset, with the 10-year yield above 5.3%, while foreign investors continued to sell Korean equities.

The benchmark KOSPI edged down to around 6,820 on Thursday, extending losses for a fourth straight session, as elevated US Treasury yields continued to weigh on equities. The 10-year Treasury yield rose to 5.3%, approaching its highest level since 2002, while the 30-year yield rose above 5.6%. Samsung Electronics and SK hynix fell modestly, while other decliners included Samsung Electro-Mechanics (-2.3%), KB Financial Group (-1.8%), Shinhan Financial Group (-1.8%), HD Hyundai Heavy Industries (-1.3%), and LG Electronics (-2.1%). Foreign investors’ continued selling of Korean equities added to the downside, with net outflows reaching around KRW21.5 trillion in September. Meanwhile, South Korean exports surged 83.5% year-on-year to a record $120.9 billion in September, led by semiconductor exports that jumped 263% to a record $60.3 billion. At the same time, Micron’s stronger-than-expected results and guidance further reinforced the underlying demand for AI-related memory products.

The benchmark KOSPI fell 0.48% to close at 6,838 on Wednesday, while posting its biggest quarterly drop since Q1 2020, plunging 19% in Q3 after six consecutive quarters of gains. The decline was driven mainly by the July selloff in major chip stocks amid concerns over high AI-related valuations. Global bond yields climbed to multi-year highs as inflation concerns and expectations for higher interest rates weighed on equities, while elevated oil prices amid ongoing Middle East tensions added to inflation risks and concerns over delayed monetary easing. Foreign investors remained net sellers of Korean equities during the quarter. Additionally, Samsung Electronics and SK hynix have completed around 80% of their combined KRW55 trillion buyback plans, raising the prospect of an earlier end to the purchases and lower KOSPI demand. Losses were seen in Samsung Electronics (-0.92%), Hyundai Motor (-1.29%), KB Financial Group (-2.42%), Shinhan Financial Group (-3.62%), and Kia Corp (-2.67%).