KOSPI climbs 3.7% on chip rally, foreign buying

KOSPI and Kosdaq are displayed in the dealing room of Hana Bank in Seoul, Wednesday. The benchmark KOSPI closed at 6,579.04, up 3.68 percent from the previous session, while the secondary Kosdaq closed at 858.91, up 0.12 percent. Yonhap

The benchmark KOSPI surged 3.68 percent Wednesday, as foreign and institutional investors piled into large-cap semiconductor stocks on upbeat earnings from major U.S. tech companies and growing expectations for shareholder returns.

The benchmark KOSPI closed at 6,579.04, up 3.68 percent from the previous session. The index opened 1.42 percent higher and extended its gains, triggering a buy-side sidecar at 11:57 a.m., the 23rd such activation this year.

Foreign and institutional investors bought a net 2.83 trillion won ($1.9 billion) and 528.4 billion won worth of shares, respectively. Retail investors, however, sold a net 3.19 trillion won worth of shares, taking profits.

Investor sentiment toward large-cap semiconductor stocks improved following strong earnings reports from major U.S. tech companies, along with expectations for shareholder return plans. SK hynix rose 5.54 percent to close at 1,504,000 won, while Samsung Electronics gained 6.68 percent to finish at 255,500 won.

CoreWeave reported second-quarter revenue of $2.58 billion, up 112 percent year on year, while raising its full-year capital expenditure guidance to $35 billion-$39 billion. Super Micro also said during its earnings call that new orders this quarter exceeded $60 billion. The company also projected fiscal 2027 revenue of $65 billion-$72 billion, well above market expectations.

Gains were not limited to semiconductor stocks, with non-chip sectors such as cosmetics and defense also posting strong advances.

The VKOSPI, which measures expected volatility in the KOSPI, has been in the 70-point range since August, and further declined to around 61 points on Tuesday.

"While the KOSPI's recent rebound has admittedly lacked momentum, more attention should be paid to the fact that the unusually high volatility that had clouded directional bets in the market is normalizing ahead of stock prices," said Han Ji-young, an analyst at Kiwoom Securities.

The Kosdaq also extended its winning streak, rising 0.12 percent to close at 858.91.

The won-dollar exchange rate closed at 1,415.7 won per dollar, down 0.3 won from the previous session.