Seoul: South Korean stocks closed slightly higher on Friday, marking their second consecutive day of gains due to increased optimism surrounding a potential diplomatic resolution to the ongoing conflict between the United States and Iran. Despite the stock market's positive performance, the South Korean won weakened against the U.S. dollar.
According to Yonhap News Agency, the Korea Composite Stock Price Index (KOSPI) rose by 32.12 points, or 0.41 percent, closing at 7,847.71. This follows a significant surge of over 8 percent in the KOSPI on Thursday, driven by strong performance in the technology sector. The trading volume was moderate, with 431.3 million shares exchanged, valued at 30.5 trillion won (approximately US$20.1 billion). The market breadth was positive, with 785 stocks advancing compared to 118 decliners.
U.S. stocks experienced gains overnight after Iran indicated that the latest proposal from the United States partially addressed the issues dividing the two nations. This development has fueled hopes that the three-month-long conflict could soon be resolved through a peace agreement.
In the Seoul market, large-cap shares showed mixed performance, while foreign investors continued their selling streak for the twelfth consecutive session. Lee Kyung-min, an analyst at Daeshin Securities, commented that the prospects for ceasefire negotiations improved following reports of a potential final agreement between the U.S. and Iran, with Pakistan acting as a mediator. However, Lee noted that the persistent foreign selling pressure remains a challenge for the local stock market.
Among major stocks, semiconductor giant Samsung Electronics saw a decline of 2.34 percent to 292,500 won, following strong gains the previous day due to a last-minute deal that averted a major strike. Conversely, SK hynix experienced a slight increase of 0.05 percent, closing at 1,941,000 won per share.
Samsung Electro-Mechanics, an affiliate of Samsung Electronics that specializes in electronic components, surged by 11.3 percent to 1,340,000 won. This increase followed the announcement of a significant artificial intelligence (AI) chip part deal with a U.S.-based technology company.
In other stock movements, AI investment firm SK Square climbed 0.51 percent to 1.19 million won, while leading battery manufacturer LG Energy Solution dipped 0.62 percent to 398,500 won. Auto sector stocks faced losses, with Hyundai Motor falling 1.65 percent to 655,000 won and its smaller affiliate Kia decreasing 1.85 percent to 164,800 won.
The Korean won depreciated against the U.S. dollar, quoted at 1,517.2 won per dollar by 3:30 p.m., representing a decline of 11.1 won from the previous trading session.