KOSPI surges 5.9% as chipmakers rally on shareholder returns
Summary
The KOSPI surged past 6,800 on Thursday, closing at 6,852.58, as SK hynix and Samsung Electronics rallied on expectations of stronger shareholder returns and lower U.S. Treasury yields lifted risk appetite. The benchmark rose 5.89 percent, and a buying-side sidecar was triggered at 9:57 a.m. It was the 49th sidecar activation on KOSPI this year. Foreign investors bought a net 1.7 trillion won of shares, while the won strengthened to 1,392.6 won per dollar.
Key Facts
- SK hynix rose 12.73 percent to 1,691,000 won, and Samsung Electronics climbed 9.49 percent to 271,000 won.
- SK hynix announced a 40 trillion won share buyback and cancellation program after the previous session's close.
- The company said it would allocate at least 50 percent of cumulative free cash flow to shareholders.
- The Kosdaq advanced 1.99 percent to 840.89, led by pharmaceutical and biotechnology shares after positive clinical trial results for Moderna's mRNA cancer vaccine.
KOSPI and Kosdaq are displayed in the dealing room of Hana Bank in Seoul, Thursday. The benchmark KOSPI closed at 6,852.58, up 5.89 percent from the previous session, while the secondary Kosdaq closed at 840.89, up 1.99 percent. Yonhap
The KOSPI surged past 6,800 on Thursday, as SK hynix and Samsung Electronics rallied on expectations for increased shareholder returns and easing U.S. Treasury yields boosted risk appetite.
The benchmark KOSPI closed at 6,852.58, up 5.89 percent from the previous session. The index opened 3.23 percent higher and extended its advance, triggering a buying-side sidecar at 9:57 a.m. It was the 49th sidecar activation on KOSPI this year.
Foreign investors bought a net 1.7 trillion won ($1.2 billion) of shares, while institutional and retail investors sold a net 219.5 billion won and 2.3 trillion won, respectively.
SK hynix surged 12.73 percent to close at 1,691,000 won, while Samsung Electronics climbed 9.49 percent to 271,000 won, as expectations for stronger shareholder payouts fueled demand for the chipmakers.
SK hynix announced a 40 trillion won share buyback and cancellation program after the previous session's close, helping reverse profit-taking pressure that had weighed on the stock following its recent rally. The company also strengthened its shareholder return policy, pledging to allocate at least 50 percent of cumulative free cash flow (FCF) to shareholders.
"If the artificial intelligence memory boom continues, even returning half of FCF could result in substantial cash distributions to shareholders," said Lee Young-gon, head of the research center at Toss Securities.
Samsung Electronics is also reportedly planning to approve a shareholder return program worth more than 100 trillion won in August, though details have yet to be finalized.
Sentiment was further buoyed by a retreat in U.S. Treasury yields. The 10- and 30-year yields reversed earlier gains after the U.S. Treasury conducted an emergency buyback of longer-dated debt, easing some of the pressure from a surge in long-term yields that had fueled turmoil in global financial markets this week.
The Kosdaq rose 1.99 percent to 840.89, led by pharmaceutical and biotechnology shares following positive clinical trial results for Moderna's mRNA cancer vaccine.
The won also strengthened. The currency closed at 1,392.6 won per dollar, improving in value by 5.1 won from the previous session. The exchange rate fell below 1,400 won per dollar on Wednesday for the first time in nearly 11 months.
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