Seoul Stock Exchange Sets Record, Technology Stocks Rise on AI Optimism

JAKARTA - The South Korean stock exchange closed trading Monday (1/6) at a new record high. The increase was supported by the strengthening of technology and artificial intelligence or AI stocks.

Yonhap quoted Monday, June 1, reported that the Korean Composite Stock Price Index or KOSPI benchmark index jumped 311.85 points, equivalent to 3.68 percent, to 8,788.38. In daily trading, the index briefly touched an intraday record of 8,874.16.

The rise was so strong that Korea Exchange or KRX activated the buy-side sidecar around 11.30. This is a temporary braking mechanism that stops the KOSPI stock program trading for five minutes when the market moves too fast.

Large trading volume. As many as 618.17 million shares changed hands with a value of 69.4 trillion won or around US$46.1 billion. However, the rally was not even. The number of shares that fell was actually more than the rising ones, namely 712 to 194.

Institutional and individual investors were the main buyers. Institutions bought 2.53 trillion won net. Retail investors bought 377.31 billion won net. On the other hand, foreign investors sold 2.91 trillion won net.

The stock rally for chips remains strong even though talks between the United States and Iran on ending the conflict and reopening the Strait of Hormuz have not produced any meaningful breakthroughs. The stagnation of the talks has also boosted oil prices.

In the stock market, investor attention is focused on semiconductors. Investors hope that the demand for chips for AI will continue to explode.

Government data showed South Korea's exports in May jumped 53 percent year-on-year to a record monthly $87.8 billion. The increase was supported by a super semiconductor cycle.

Robotics and AI stocks have strengthened ahead of the visit of Nvidia Corp. CEO Jensen Huang to South Korea this weekend. The market reads the visit as an opportunity for new cooperation with the US chip giant.

At the Computex conference in Taipei, Huang said Nvidia's Vera CPU, which is designed for AI agents, will use high-bandwidth memory chips or HBM from Samsung Electronics, SK hynix, and Micron.

"Huang's announcement on the Vera chip, coupled with expectations for his visit to South Korea, has boosted investor sentiment toward chipmakers. Samsung Electronics, whose shares have recently lagged behind SK hynix, recorded a sharp rally," said Daishin Securities analyst Lee Kyung-min.

According to Lee, large stocks in the AI and robotics sectors led the market's strength as investors hoped for opportunities for cooperation with Nvidia.

Samsung Electronics jumped 10.09 percent to a record high of 349,000 won. Rival SK hynix rose 1.29 percent to 1.36 million won.

Hyundai Motor gained 3.73 percent to 750,000 won. SK Square, an AI-related investment company, rose 1.87 percent to 1.25 million won.

LG Electronics jumped 29.86 percent to 380,500 won. Naver, South Korea's internet portal operator, rose 16.03 percent to 271,500 won after reports emerged that the two companies' leaders were likely to meet Huang to discuss an AI partnership.

The Korean won also strengthened. The currency was at 1,504.3 won per US dollar at 15.30, up 3.6 won from the previous session.

In the bond market, prices closed weaker. The yield on the three-year government bond rose 5.9 basis points to 3.790 percent. The yield on the benchmark five-year bond rose 7.2 basis points to 3.996 percent.