South Korean stocks experienced a robust recovery on Wednesday, driven by easing concerns over artificial intelligence (AI) spending, which significantly boosted semiconductor shares. The Korea Composite Stock Price Index (KOSPI) surged 3.29%, closing at 5,735.66, a gain of 182.92 points. This rally prompted a temporary suspension of program buying by the Korea Exchange after KOSPI 200 futures rose more than 5%, a measure taken for the first time in two months.
The positive market sentiment was largely influenced by better-than-expected earnings from Super Micro Computer, a US-based AI server manufacturer, which alleviated fears about excessive investment in AI infrastructure. This optimism was reflected in the performance of major South Korean technology companies, with Samsung Electronics and SK hynix seeing substantial gains. Samsung Electronics’ shares increased by 5.67% to 223,500 won, while SK hynix rose 5.81% to 1.29 million won. Additionally, SK Corp., the holding company of SK Group, saw a notable increase of 12.62% to 482,000 won, bouncing back from a previous decline.
LS Electric also benefited from the positive trend, climbing 7.02% to 166,100 won following strong third-quarter earnings driven by increased demand for power equipment in AI data centers. However, not all sectors shared in the positive momentum. Defense company LIG D&A faced a significant setback, plummeting 9.03% to 498,500 won after being barred from bidding on defense contracts for two years due to bribery allegations.
Foreign investors played a crucial role in the market’s recovery, purchasing a net 659.96 billion won worth of South Korean shares. The Korean won also strengthened slightly, trading at 1,325.2 against the US dollar, an improvement of 0.8 won from the previous session’s close.
This rebound in South Korea’s stock market highlights renewed investor confidence in technology stocks. Strong corporate earnings have helped alleviate concerns regarding AI infrastructure investments, contributing to a broader market recovery.