Kospi Breaks 4000 Barrier, Sets Record High Amid SK Hynix Gains and Economic Optimism

The Kospi index surged past the 4000 mark on October 29, marking a historic milestone and closing at an all-time high. Driven by SK Hynix's stellar earnings and favorable macroeconomic factors, the benchmark index climbed 1.76%, reflecting robust investor confidence. Institutional buying provided significant momentum, overshadowing foreign and retail investor selling. The South Korea-U.S. summit and developments in tech and global industries further buoyed market sentiment.

H2: Kospi Rallies to Record High

In a remarkable rebound, the Kospi index closed at 4081.15, a gain of 70.74 points from the previous session's 4010.41. The index opened strong at 4061.54, adding 51.13 points right at the start, and maintained consistent upward momentum throughout the day.

This move followed a brief pause in the Kospi’s ascent after initially crossing the significant 4000 level. However, strong corporate earnings, particularly from SK Hynix, combined with macroeconomic catalysts, pushed the index not only back above 4000 but to new record highs.

H2: SK Hynix's Record Earnings Propel Market Gains

The driving force behind the Kospi’s performance was SK Hynix, whose record-breaking earnings captured market attention. The company unveiled third-quarter operating profits of 11.38 trillion won, a staggering 61.9% year-over-year increase, alongside 39.1% growth in revenue, reaching 24.45 trillion won. Net income accelerated even further, more than doubling by 119% to 12.6 trillion won—the first time in SK Hynix’s history that quarterly profits have exceeded 10 trillion won.

Analysts like Lee Jae-won from Shinhan Investment Corp highlighted SK Hynix’s phenomenal results, noting the company’s stock soared to a record high of 558,000 won. Lee also emphasized Nvidia CEO Jensen Huang's recent remarks at the GTC conference, which added optimism to the semiconductor sector. Increased investor interest in semiconductors, nuclear energy, and secondary batteries undoubtedly fueled Kospi’s rally to unprecedented levels.

H2: Institutional Buying Dominates Market Dynamics

Institutional investors played a critical role in advancing the Kospi. Data from the Korea Exchange shows institutions were net buyers to the tune of 6.74 trillion won, effectively offsetting selling pressure from foreign (1.82 trillion won) and retail (4.39 trillion won) investors.

Market watchers underscored the importance of the geopolitical backdrop, specifically the ongoing South Korea-U.S. summit held in Gyeongju, and upcoming U.S. big tech earnings reports. While institutional investors maintained their buying streak, foreign participation showed signs of stabilization, particularly in semiconductors, despite profit-taking activity.

H2: Mixed Results Among Large-Cap Stocks

Large-cap stocks delivered a mixed performance despite the Kospi’s overall gains. Samsung Electronics inched upward by 1.01%, ending the day at 100,500 won and reclaiming its symbolic “10-million won” valuation. SK Hynix, bolstered by its record earnings, surged by 7.10% to close at 558,000 won.

Other notable gainers included Doosan Enerbility, which achieved an impressive increase of 11.57%. However, some major players struggled; Hanwha Aerospace edged down by 0.30%, and Samsung Biologics saw a slight 0.89% decline, illustrating divergent movements across industry sectors.

H2: Kosdaq Falters Amid Institutional Selling

While the Kospi soared to new heights, the Kosdaq index faced downward pressure. Closing at 901.59, a slight fall of 1.71 points or 0.19%, the tech-heavy index failed to maintain early gains. It initially opened strong at 906.50, up 3.20 points, but institutional investors' net selling of 60.4 billion won dragged the index into negative territory.

Despite institutional outflows, individual and foreign investors showed interest, purchasing 72.9 billion won and 34.5 billion won, respectively. Some Kosdaq-listed firms saw positive results, with Rainbow Robotics (0.58%), HLB (0.84%), and Peptron (1.92%) gaining. However, losses in PharmaResearch (-3.73%), LegoChem Biosciences (-1.94%), and EcoPro (-4.22%) counterbalanced these advances.

H2: South Korean Won Strengthens Against U.S. Dollar

In currency markets, the South Korean won gained strength on October 29. The currency closed at 1431.7 won per dollar, improving by 6.0 won from the previous session’s close of 1437.7 won. This appreciation adds another layer of optimism for the broader economic outlook.

H2: Investor Sentiment and Future Market Drivers

As the Kospi achieves historic highs, a combination of robust corporate results and favorable macroeconomic developments has been pivotal. However, market participants remain vigilant about forthcoming U.S. big-tech earnings, geopolitical nuances such as South Korea-U.S. relations, and evolving trends in institutional and foreign investor behaviors. These factors are expected to play a significant role in shaping further movements in South Korea's equity markets.