- The Korea Composite Stock Price Index (KOSPI) closed sharply higher on Thursday, rebounding 5.42% to 8,930.30 points, marking the second consecutive day of gains, effectively recovering from the historic tech stock declines earlier this week due to interest rate concerns.
- Heavyweight stock SK Hynix (000660:KS) surged 13.06%, and Samsung Electronics (005930:KS) rose 5.29%, mainly benefiting from Micron Technology's (MU:US) strong earnings report and optimistic outlook, boosting confidence in the memory chip industry.
- Despite the benchmark index's strong rebound, foreign investors were net sellers of Korean stocks worth 835.5 billion won (approximately 541.68 million USD) throughout the day, as the market showed a tug-of-war between bargain hunting and macro interest rate risks.
Demand for Memory Chips Drives Strong Recovery in Tech Heavyweights
The strong performance of the Korean stock market today was mainly driven by the semiconductor sector. Micron Technology's latest financial report and optimistic future outlook effectively alleviated market concerns about the peak in profit growth for the AI and semiconductor industries. Eugene Investment Securities analyst Huh Jae-hwan pointed out that Micron's earnings report not only boosted market confidence but also confirmed that the strong profit growth trend in memory chips has not yet peaked. As a result, SK Hynix achieved an astonishing single-day gain of 13.06%, and Samsung Electronics also rose in tandem. Both companies have benefited from the surge in global chip demand this year, driving the KOSPI index up 112% year-to-date, leading major global stock indices.
Market Internal Structure Divergence and Foreign Capital Cashing Out
Although the KOSPI index recorded a significant rise driven by tech giants, the market's internal breadth remained under pressure. Out of a total of 916 traded stocks, only 291 stocks rose, while 589 stocks fell. There was a clear divergence in the performance of heavyweight stocks, with battery manufacturing giant LG Energy Solution (373220:KS) falling 3.69% against the trend, Hyundai Motor (005380:KS) also declined 1.18%, while Kia Motors (000270:KS) slightly increased by 0.43%. Additionally, external funds remained cautious, with foreign investors net selling 835.5 billion won during today's rebound, indicating a structural adjustment in the allocation of emerging market risk assets by overseas institutions in the context of a potentially prolonged high-interest rate environment.
Macro Interest Rate Concerns and Stable Onshore Exchange Rate
The recent volatility in the Korean stock market highlights the intense tug-of-war investors face between concerns over rising macro interest rates and seeking high-growth opportunities in tech stocks. On Tuesday, the KOSPI index recorded a nearly 10% plunge, marking the largest single-day drop since March this year, reflecting the phase pricing pressure brought by macro tightening policies on high-valuation sectors. However, the onshore currency market remained relatively stable, with the Korean won closing at 1,542.7 against the US dollar (USD/KRW), almost unchanged from the previous trading day. Analysts pointed out that if the interest rate path of major global central banks turns more hawkish in the future, the valuation level of the Korean stock market, as a barometer of the global tech cycle, may face the risk of reassessment.
