South Korea’s KOSPI Surges to Record Highs, Backed by U.S. Market Momentum

The KOSPI index continued its historic ascent on October 23, breaking new intraday records. Riding the wave of positive sentiment from Wall Street, it touched an all-time high of 3,949.49 points during the session before settling at 3,487.74 points as of 9:30 a.m. KST. This represented a gain of 19.09 points (0.55%) from the previous session’s close. The day’s opening at 3,489.46 points was an early indication of its upward trajectory, rising 20.81 points (0.60%) from the last closing figure of 3,468.65.

KOSPI’s Recent Performance: A Steady Climb

This month has marked a momentous period for the KOSPI. On October 10, it closed at a record 3,314.53 points, surpassing its previous peak of 3,305.21 set on July 6, 2021. This milestone ignited a five-day streak of setting new highs, further solidifying its bullish momentum. While the index pulled back momentarily ahead of the Federal Open Market Committee (FOMC) meeting, optimism returned on October 18 when the FOMC announced a critical interest rate cut. Since then, KOSPI has shown consistent growth, continuously shattering previous records.

Key Market Catalysts: U.S. Market Influence and Local Strength

Han Ji-young, a trusted researcher at Kiwoom Securities, highlighted the pivotal role of U.S. markets, specifically the tech sector, in driving this trend. “The rally in U.S. markets, supported by significant performances from tech heavyweights like NVIDIA and Apple, has played a vital role despite ongoing hawkish stances from Federal Reserve officials,” Han commented. He further emphasized the positioning of Korean IT and semiconductor stocks as beneficiaries of this rally. However, he cautioned that intraday profit-taking could prompt shifts within sectors.

In the trading breakdown, individual investors remained net buyers, purchasing shares worth a solid 333.1 billion KRW. Foreign investors and domestic institutions, however, emerged as net sellers, offloading 87.9 billion KRW and 220.9 billion KRW in shares, respectively.

Sectoral and Stock Highlights: Mixed Performances Across Industries

While the overall market surged, sectoral performances highlighted areas of strength and weakness. Leading industries included precision medical devices (up 1.28%), utilities (up 1.15%), and transportation equipment (up 0.17%). On the flip side, losses were observed in construction (-0.33%), transportation and warehousing (-0.10%), and financials (-0.02%).

Major blue-chip stocks played a central role in the rally. Samsung Electronics extended its record-breaking run, advancing by 1.68% to close at 84,900 KRW. Semiconductor giant SK Hynix also posted gains, climbing 1.42%, while LG Energy Solution added 0.43%. Conversely, Hanwha Aerospace fell by 0.39%, KB Financial dipped 0.94%, and HD Hyundai Heavy Industries declined by 0.60%.

Han of Kiwoom Securities attributed the robust semiconductor segment performance to renewed government initiatives supporting market normalization. “The semiconductor uptrend reflects growing confidence in long-term sustainability,” Han said, mirroring sentiment that the sector remains a core pillar driving domestic market optimism.

KOSDAQ Records Modest Gains Amid Sectoral Divergence

The KOSDAQ index saw a quieter day of trading but managed to notch upward, closing at 875.31 points, an increase of 0.95 points (0.11%). Like its KOSPI counterpart, the KOSDAQ opened higher at 877.18 points, gaining 2.82 points (0.32%) from the prior session’s close of 874.36.

Individual investors focused on acquiring shares, with net purchases totaling 105.3 billion KRW. However, foreign and institutional investors sold off 71.4 billion KRW and 15.4 billion KRW worth of shares, respectively.

Sector-wise, precision medical instruments stood out with a strong 2.21% increase, while electrical and electronics gained 0.37%, followed by machinery equipment at 0.19%. On the downside, losses were prominent in entertainment and culture (-0.69%), metals (-0.13%), and blue-chip stocks (-0.49%).

Top-performing KOSDAQ stocks included Peptron, which surged 3.29%, EcoPro BM, up 0.85%, and Samchundang Pharm, which gained 0.97%. At the same time, other stocks faced setbacks; Altimmune fell sharply by 3.16%, and Pharma Research saw a steeper drop of 4.43%.

Currency Market: The Korean Won Shows Strength

The South Korean won demonstrated signs of resilience in the foreign exchange market. The KRW/USD exchange rate opened at 1,391.2 KRW per U.S. dollar, a slight drop of 1.4 KRW compared to the previous closing price of 1,392.6 KRW. The modest strengthening reflects growing investor optimism, supported by external influences from U.S. tech stocks and an underlying confidence in South Korea’s economic stability.

Outlook: Can KOSPI Sustain Its Record Momentum?

The combined rally in KOSPI and KOSDAQ, alongside currency stability, underscores a bullish sentiment prevailing in the South Korean market. With global markets highly volatile and economic headwinds persisting, investors are closely monitoring KOSPI’s ability to maintain its upward trajectory. Domestically, strong performances in semiconductors and IT-related industries augur well, but external factors, including U.S. Fed policies and global macroeconomic shifts, remain critical determinants in sustaining this momentum.

All eyes now turn to the next wave of economic data and policy developments, as South Korea’s markets aim to solidify their leadership in a challenging global landscape.