South Korean Shares Edge Lower on Inflation Concerns

The benchmark KOSPI edged down to around 6,950 on Friday, reversing gains from the previous session as concerns over domestic inflation and elevated global bond yields weighed on the index. Korea’s CPI held at 2.9% in September, while the BOK warned that inflation could stay around 3% in October, raising the prospect of another rate hike. At the same time, US Treasury yields stayed high after the 10-year yield briefly topped 5.3%, while oil prices climbed above $100 a barrel amid renewed Middle East tensions, adding to inflation risks. However, stronger-than-expected results and an upbeat memory outlook from Micron provided a positive read-through for Samsung Electronics and SK hynix, while record South Korean semiconductor exports reinforced the sector’s strong outlook. Large-cap stocks were mixed, with losses seen in Samsung C&T Corp (-1.4%), Doosan Enerbility (-0.85%), and HD Hyundai Heavy Industries (-1.0%), while Samsung Electronics and SK Square edged higher.

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.