Kospi jumps more than 3.5% with tech stocks leading gains

Shares soared by more than 3.5 percent Wednesday as easing concerns over the profitability of AI investments and hopes for an interim agreement between the United States and Iran over the Strait of Hormuz boosted investor sentiment.

The benchmark Kospi soared 3.76 percent, or 239.31 points, to close at 6,598.26, after reaching an intraday high of 6,674.66.

The index rose 1.62 percent Tuesday after plunging 5.12 percent the previous day.

Trade volume was moderate at 335.16 million shares worth 25.21 trillion won ($17.7 billion), with winners far outnumbering losers 672 to 197.

Foreigners bought a net 1.45 trillion won worth of stocks, while institutions and individuals sold a net 283.5 billion won and 1.18 trillion won, respectively.

The Korea Exchange activated a buy-side sidecar for the Kospi for five minutes at 9:25 a.m. after the index surged on gains in technology stocks.

Overnight, U.S. stocks advanced as investors bet that a possible agreement to reopen the crucial shipping route could extend the recent decline in oil prices and ease inflationary pressures.

The Dow Jones Industrial Average rose 1.71 percent to 54,085.88, while the tech-heavy Nasdaq Composite climbed 2.59 percent to 26,584.99.

"On top of Hormuz reopening hopes, robust earnings from U.S. tech firms helped ease concerns over heavy investment in the AI sector," Kang Jin-hyeok, an analyst at Shinhan Securities, said.

In Seoul, tech stocks led the gains.

Market bellwether Samsung Electronics rose 2.5 percent to 246,000 won, and its chipmaking rival SK hynix climbed 5.77 percent to 1,668,000 won.

Top carmaker Hyundai Motor rose 3.06 percent to 404,500 won, and national flag carrier Korean Air gained 3.07 percent to 26,900 won.

Among decliners, leading refiner SK Innovation fell 1.89 percent to 109,200 won, and S-Oil declined 2.62 percent to 122,500 won.

The local currency strengthened by 8 won to trade at 1,424.5 won against the dollar at 3:30 p.m.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys fell 7.1 basis points to 3.669 percent, while the return on the benchmark five-year government bonds dropped 8.8 basis points to 3.916 percent.

Yonhap