The KOSPI opened weaker on the 29th as oil prices and U.S. Treasury yields climbed together after talks between Washington and Tehran stalled. Samsung Electronics slipped slightly in early trading, with market watchers pointing to the possibility that financial investment firms would unwind arbitrage positions on the stock's ex-dividend date.
As of 9:06 a.m. on the 29th, the KOSPI stood at 6,845.64, down 44.10 points or 0.64% from the previous session, according to the Korea Exchange (KRX). The index opened at 6,844.41, down 45.33 points or 0.66%. On the main bourse, foreign investors sold a net 192.9 billion won worth of shares immediately after the open, dragging the index lower, while individuals and institutions bought 108.2 billion won and 78.8 billion won, respectively.
Most large-cap stocks traded lower. Samsung Electronics (005930.KS) changed hands at 269,500 won, down 0.19%. LG Energy Solution (373220.KS) fell 3.43%, Samsung Life Insurance (032830.KS) 2.36%, Samsung Electro-Mechanics (009150.KS) 1.87%, Samsung Biologics (207940.KS) 1.86%, Hyundai Motor (005380.KS) 1.27% and Samsung Electronics preferred shares 1.21%. SK hynix (000660.KS) bucked the trend, trading 0.23% higher at 1.772 million won.
Sentiment was weighed down after the United States overnight rejected an Iranian proposal that included reopening the Strait of Hormuz, sending oil prices and Treasury yields higher again. The U.S. 10-year Treasury yield rose to about 5.24%, its highest level since 2007. West Texas Intermediate (WTI) crude also surged during the session, heightening caution over high rates and high oil prices. On Wall Street, the Dow Jones Industrial Average fell 0.67%, the Standard & Poor's 500 lost 0.77% and the Nasdaq Composite dropped 0.92%.
Reports that OpenAI had temporarily halted training of its latest artificial intelligence model for safety checks also hurt sentiment toward chipmakers and other technology stocks. Nvidia rose 1.68% after announcing the largest share buyback plan in U.S. history at $150 billion, but other chip names fell across the board amid the AI safety debate: AMD dropped 3.61%, Qualcomm 7.17%, Intel 5.67%, Micron 2.61%, SK hynix's American depositary receipts (ADRs) 5.03% and SanDisk 3.65%.
Supply-and-demand swings tied to Samsung Electronics' ex-dividend date are seen as a wild card for the domestic market. According to Eugene Investment & Securities, financial investment firms bought a net 2.8 trillion won of KOSPI 200 cash equities in the week before the ex-dividend date, including 1.6 trillion won of Samsung Electronics alone. Over the same period, they sold 3.5 trillion won of index futures, building long-cash, short-futures arbitrage positions. Once those positions are unwound after the ex-dividend date, selling in cash equities such as Samsung Electronics could coincide with buying back futures.
"Today the market could see volatility spilling over from Samsung Electronics' ex-dividend date and from macro factors," said Han Ji-young, an analyst at Kiwoom Securities (039490.KS). "But with the OpenAI news already priced in the previous session, the index is likely to recoup some of its losses during the session as bargain hunting emerges on the view that the decline has been excessive."
