Seoul: South Korea's stock market surged past the 2,900-point threshold for the first time in over three years on Wednesday, extending its winning streak to a sixth consecutive day. The rally was driven by sustained foreign investment and advancements in trade negotiations between the world's two largest economies.
According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) rose by 35.19 points, or 1.23 percent, closing at 2,907.04. This marks the highest closing level since January 14, 2022, when the index stood at 2,921.92. The trading session witnessed significant activity with a trade volume of 383.5 million shares valued at 12.3 trillion won (US$9 billion), with winners outnumbering losers 600 to 281.
Foreign investors have maintained their purchasing trend of local shares for the sixth consecutive session. Lee Jae-won, an analyst at Shinhan Securities, indicated that the KOSPI's breach of the 2,900-point mark was fueled by positive momentum from favorable U.S.-China trade negotiations and foreign investors' ongoing acquisitions of major-cap shares.
High-level officials from Washington and Beijing engaged in trade talks in London over two days, concluding on Tuesday. They reached an agreement on a framework to address trade disputes involving rare earths and technology. Kim Jae-seung, an analyst at Hyundai Motor Securities, noted that expectations regarding the Lee Jae-myung administration's policy to enhance the local stock market have also bolstered market sentiment.
Lee, who assumed office last week, has pledged to usher in a 5,000-point era and eliminate the so-called Korea discount, which refers to the undervaluation of South Korean assets due to geopolitical risks or other concerns.
Meanwhile, Wall Street also experienced gains overnight, with the Dow Jones Industrial Average rising 0.25 percent, the S and P 500 increasing by 0.55 percent, and the tech-heavy Nasdaq composite climbing 0.63 percent.
In Seoul, tech giant Samsung Electronics rose 1.18 percent to 59,900 won, while its competitor SK hynix saw a 4.12 percent jump to 240,000 won. Leading automaker Hyundai Motor advanced 2.03 percent to 201,000 won, and its affiliate Kia increased by 2.54 percent to 96,900 won. Hyundai Mobis, an auto-parts manufacturer, surged 4.91 percent to 288,500 won.
Among other notable movers, Doosan Enerbility, a major nuclear power plant manufacturer, surged 6.46 percent to 51,100 won, and Kakao, the operator of the country's dominant mobile messenger, increased by 2.8 percent to 51,400 won.
Conversely, some major defense and shipbuilding stocks experienced declines as investors sought to capitalize on profits following the previous day's rally. Defense firm Hanwha Aerospace fell 3.31 percent to 905,000 won, and leading shipbuilder HD Hyundai Heavy declined by 2.11 percent to 418,000 won.
Financial sector stocks also saw a downturn, with KB Financial dipping 3.34 percent to 107,200 won and Shinhan Financial losing 1.81 percent to 59,800 won. The local currency traded at 1,375.0 won against the U.S. dollar at 3:30 p.m., down 10.7 won from the previous session.
Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasurys increased by 3.4 basis points to 2.419 percent, while the yield on five-year government bonds rose 1.9 basis points to 2.581 percent.