The KOSPI reclaimed the 7,000 mark on the back of strong semiconductor exports and expectations for a recovery in the memory chip market. Buying flowed into large-cap chipmakers led by Samsung Electronics (005930.KS) from the opening bell, and institutional investors lifted the index with net purchases of more than 1 trillion won. The index slipped from its intraday high, however, as foreign investors turned net sellers during the session and retail investors locked in profits.
The KOSPI closed at 7,007.72 on the 21st, up 113.49 points, or 1.65%, from the previous session, according to the Korea Exchange. The index opened at 6,938.34, crossed 7,000 shortly after the open and rose as high as 7,027.58 during the session. It briefly fell back below 7,000 in the afternoon as foreign selling of cash equities widened, but recovered late in the day to close above the threshold for the first time in seven sessions.
Institutional buying stood out in trading flows. Institutions bought a net 1.4923 trillion won on the main board. Retail and foreign investors sold a net 2.979 trillion won and 160.2 billion won, respectively. Foreign investors, who were net buyers early in the session, switched to net selling in the afternoon.
Semiconductors drove the advance. Samsung Electronics closed 4.98% higher at 274,000 won, while SK hynix (000660.KS) rose 0.59% to 1.868 million won. Samsung Electronics preferred shares (005935.KS) gained 6.07%, Samsung Electro-Mechanics (009150.KS) 2.95% and SK Square (402340.KS) 4.45%. Gains broadened across themes, with semiconductor materials and components up 3.61%, system semiconductors up 3.52% and high-bandwidth memory (HBM) shares up 3.63%.
News that semiconductor exports hit a record high appeared to boost investor sentiment. Chip exports in the first 20 days of this month totaled $34.1 billion, up 259.4% from a year earlier. Total exports rose 78.3% to $71.4 billion. Analysts attributed the gains to strength in memory shares such as Micron and Western Digital on U.S. markets last week, combined with forecasts for higher memory prices, which fueled expectations for improved earnings at Korean chipmakers.
Large share buybacks underway at Samsung Electronics and SK hynix are also supporting demand. As of the 18th of this month, Samsung Electronics had completed 74.7% of its planned repurchases and SK hynix 58.8%. Other corporate entities bought a net 1.1092 trillion won of SK hynix and 514.9 billion won of Samsung Electronics on the day, for combined net purchases of 1.6241 trillion won in the two stocks. Given the pace of buying, Samsung Electronics could exhaust its planned volume in early next month and SK hynix around the middle of the same month, making subsequent shifts in demand a variable to watch.
A pullback in international oil prices from their highs also supported risk appetite. West Texas Intermediate and Brent crude futures fell to around $94 and $102 a barrel, respectively. With expectations for talks between the United States and Iran easing some upward pressure on oil, and after markets digested major monetary policy events last week including the U.S. Federal Open Market Committee and Bank of Japan meetings, attention appears to be shifting back to fundamentals such as earnings and exports.
Still, thin trading ahead of the Chuseok holiday is seen as a source of short-term volatility. "This week is expected to be a period of reconfirming the market's resilience while digesting existing macro and artificial intelligence issues," said Han Ji-young, an analyst at Kiwoom Securities. Lee Kyoung-min, an analyst at Daishin Securities, said increased volatility ahead of the holiday is an opportunity to add exposure, and forecast that whether the KOSPI settles in the 6,900-7,100 range will mark a turning point for its future direction.
