South Korean Shares Snap 5-Day Decline

The benchmark KOSPI rose nearly 1% to around 6,080 on Wednesday, snapping a five-day slide near a more than two-month low, as investors bought semiconductor shares following a sharp selloff in the previous session. Samsung Electronics and SK hynix climbed nearly 2% and more than 1%, respectively, recovering part of Tuesday's plunge of 7.39% and 10.09%. Gains also extended to other heavyweight stocks, including SK Square (1.28%), LG Energy Solution (2.7%), Hyundai Motor (1.1%), Kia Corporation (1.4%), Hyundai Mobis (4.1%), and Samsung Electro-Mechanics (1.7%). Meanwhile, lingering concerns over Chinese chipmaker CXMT's technological advances and the sustainability of AI spending continued to weigh on the sector. Investors also remained cautious ahead of the US September inflation report, with an expected acceleration in consumer prices potentially complicating the Federal Reserve's interest rate outlook and adding to concerns over technology stock valuations.

The benchmark KOSPI plunged 5.46% to close at 6,035 on Tuesday, after hitting a more than two-month intraday low of 5,911, as mounting concerns over AI valuations and Chinese competition triggered heavy selling in semiconductor stocks. Samsung Electronics and SK hynix slipped 7.19% and 10.09%, respectively, after reports of technological progress by Chinese rival CXMT and renewed doubts about the sustainability of AI spending. Foreign investors sold a net KRW 4.51 trillion worth of shares, adding to the decline. Additionally, Brent crude prices climbed above $106 per barrel amid escalating Middle East tensions, heightening concerns over imported inflation and the interest-rate outlook. Investors are awaiting September US CPI data for further clues on the Federal Reserve's policy outlook. Other notable decliners included SK Square (-13.01%), Samsung Electro-Mechanics (-8.41%), Hyundai Motor (-1.56%), Doosan Enerbility (-1.82%), Hanwha Aerospace (-2.55%), and LG Electronics (-3.79%).

The benchmark KOSPI slipped 3.65% to close at 6,384 on Monday, approaching its lowest level since August, as technology stocks led the decline amid growing concerns over AI valuations. OpenAI’s lower-than-indicated annualized revenue raised doubts about whether AI demand can justify massive investments in chips and data centers. SK hynix and Samsung Electronics plunged 3.87% and 3.82%, respectively, as foreign investors continued heavy selling. Renewed Houthi attacks on Saudi Arabia's main airport over the weekend also heightened concerns over a broader regional conflict, while the possibility of further US involvement added to geopolitical uncertainty. Furthermore, elevated US Treasury yields and persistent inflation concerns weighed on equities. Other notable decliners included SK Square (-6.00%), Doosan Enerbility (-8.46%), Hanwha Aerospace (-3.37%), HD Hyundai Heavy Industries (-5.34%), LG Electronics (-7.73%), and LS Electric (-5.83%).