WorldMarkets
Seoul shrugs off the US chip rout as Kospi turns higher on Samsung and SK Hynix
South Korea's main index opened more than 1% lower after Friday's plunge in American semiconductor shares, then swung into gains by mid-morning as its two chip giants recovered.
Key points
- The Kospi opened more than 1% lower after a 7.2% fall in US chip stocks.
- By about 8:45 am IST it was up 1.4%, led by Samsung and SK Hynix.
- Korea's October exports rose 93.7% from a year earlier.
South Korea’s stock market shook off a bruising start on Monday. The Kospi opened more than 1% lower after Friday’s collapse in American chip shares, then clawed its way back and was trading in positive territory by mid-morning in Seoul.
The two heavyweights that dominate the index led the turn. Samsung Electronics and SK Hynix moved higher after the early selling, and by about 8:45 am IST the Kospi was up 1.4%. Tokyo’s Nikkei 225 was still slightly lower at that point.
The rebound came against a hard backdrop. In New York on Friday the Philadelphia semiconductor index plunged 7.2%, its slide led by Intel’s steepest one-day fall in more than four decades, as investors questioned the return on the AI spending of America’s big technology companies. Seoul felt it first: the Kospi fell 3.48% on Friday and lost 16.2% in October.
Korea’s own trade data tells a different story. October exports rose 93.7% from a year earlier, giving a trade surplus of $42.5 billion, on the strength of the global technology upcycle. Analysts at MUFG say that upcycle supports the won, but that heavy selling of Korean shares by foreign investors has capped its gains.
President Lee Jae-myung also presented next year’s budget to the National Assembly on Monday, calling for a new formula for growth and a shift towards growth that benefits everyone.
For Indian investors, the recovery in Seoul matched the mood at GIFT City, where Nifty futures pointed to a firm open for Dalal Street.