Kospi Jumps 3.6% to 6,813 as Softer US Inflation Revives AI Trade
Summary
- The Kospi rose for a fourth straight trading day as slower July US consumer price inflation reduced the likelihood of a US rate hike.
- Strength in Micron and Nvidia after signs of solid AI infrastructure demand in the US stock market spilled over into South Korean semiconductor shares and materials, parts and equipment makers.
- Foreign investors were net buyers of 2.4439 trillion won ($1.76 billion), and institutions also posted net buying, while retail investors were net sellers of 3.1591 trillion won ($2.27 billion).
Forecast Trend Report by Period
As odds of a US rate hike recede
Index rises for a fourth straight session, retakes 6,800
Foreign investors buy a net $1.76 billion; institutions also add
South Korea’s Kospi rose more than 3% for a second straight day and reclaimed the 6,800 level as softer US inflation revived appetite for artificial intelligence-related shares.
The Kospi closed 3.56% higher at 6,813.34 on Aug. 13. After a 3.68% gain the previous day, the index has risen for four straight sessions since Aug. 10, reaching its highest level in 15 trading days since July 23, when it ended at 7,096.89. It marked the first four-session winning streak since early June.
The benchmark climbed more than 4% at the open and rose as much as 6,895.63 intraday, briefly nearing 6,900, before paring gains. All 10 of the market’s largest stocks by capitalization advanced. Samsung Electronics rose 4.89% and SK Hynix gained 5.92%, while SK Square jumped 9.08% and Samsung Electro-Mechanics surged 12.58%.
The Kosdaq added 0.29% to close at 861.37, extending its advance to a fourth straight session. Semiconductor materials, parts and equipment makers outperformed, with Wonik IPS up 7.62% and Jusung Engineering gaining 3.05%.
The rally in Seoul followed an overnight rebound in investor sentiment on Wall Street. Despite heightened tensions in the Middle East, US consumer prices and core inflation for July slowed from the previous month to 3.4% and 2.5%, respectively, reducing expectations of another Federal Reserve rate increase. CME FedWatch data showed a 59.9% probability that the Fed will leave rates unchanged in September.
In the US market, earnings from Nebius, following results from CoreWeave and Super Micro, reinforced signs of solid demand for AI infrastructure. Micron Technology rose 4.9%, SanDisk gained 5.8% and Nvidia added 3.0%, helping drive gains in South Korean chip shares.
Foreign investors extended net buying on the Kospi to a third straight session. Data from the Korea Exchange and Nextrade showed overseas investors bought a net 2.4439 trillion won ($1.76 billion) of stocks on the main board on Aug. 13. That was down from 3.4907 trillion won ($2.51 billion) a day earlier, but buying continued. Institutions bought a net 791.5 billion won ($570 million), while retail investors sold a net 3.1591 trillion won ($2.27 billion) as they locked in short-term profits.
Lee Kyung-min, an analyst at Daishin Securities, said the favorable backdrop for US semiconductor stocks spread to South Korea’s chip sector, lifting both large-cap chipmakers and suppliers of materials, parts and equipment. Strength in IT hardware also highlighted momentum across the AI infrastructure value chain, he added.
Kang Jin-gyu, Hankyung.com reporter josep@hankyung.com
Korea Economic Daily
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