Seoul:South Korean shares ended slightly higher on Friday, rebounding from a significant drop of over 3 percent in the previous session. Investors sought bargains in major chip stocks, despite ongoing concerns over investments in the artificial intelligence (AI) value chain. Additionally, the Korean won gained strength against the U.S. dollar.
According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) increased by 16.53 points, or 0.3 percent, closing at 5,550.30 after experiencing volatile trading. The index initially opened 2.36 percent lower, with individual investors initially being net sellers but later shifting to net buyers.
The trading volume was light, with 236 million shares valued at 16.5 trillion won (US$12.4 billion) changing hands. Decliners significantly outnumbered advancers, with 716 stocks falling compared to 173 that rose. Foreign investors sold a net 98.3 billion won, while institutions and individuals purchased a net 86.8 billion won and 4.5 billion won, respectively.
In the U.S., stocks closed mixed overnight, with losses in major technology shares impacting the broader market. The Dow Jones Industrial Average edged up 0.02 percent, while the S&P 500 fell 1.21 percent, and the tech-heavy Nasdaq Composite dropped 2.6 percent. Notable tech companies such as Micron Technology, Nvidia, and Intel witnessed significant declines.
In Seoul, large-cap shares exhibited mixed performance. Samsung Electronics saw a slight increase of 0.47 percent, closing at 215,500 won. SK hynix, another key chipmaker, rose 4.42 percent to 1.28 million won, recovering from earlier losses following the announcement of the suspension of its U.S. subsidiary Solidigm's listing plans. SK Square, an AI investment firm, also gained 3.2 percent, closing at 775,000 won.
The decision to shelve Solidigm's initial public offering (IPO) plans eased concerns about a potential holding company discount, which occurs when a parent company's stock trades below the value of its assets. Analyst Lee Kyoung-min from Daishin Securities noted that previous concerns over AI investments from the U.S. had been factored into the market after the declines of Samsung Electronics and SK hynix in the previous session.
The Korean won was quoted at 1,324.6 against the U.S. dollar as of 330 p.m., marking an increase of 0.4 won from the previous trading session's close. Bond prices, which move inversely to yields, ended higher with the yield on three-year Treasurys dropping 3.7 basis points to 3.803, and the yield on the benchmark five-year government bonds decreasing by 3.5 points to 3,948.