SEOUL, September 28 (AJP) - South Korean stocks fell more than 1 percent Monday morning, dropping below 7,000 as the market reopened after Chuseok, the traditional Korean Thanksgiving holiday, and foreign investors sold semiconductor heavyweights amid elevated U.S. Treasury yields.
The benchmark KOSPI stood at 6,936.34 as of 10:56 a.m. (0156 GMT), down 2.04 percent from its pre-holiday close of 7,080.92. The index opened 0.33 percent lower at 7,057.86 before extending losses and falling further below 7,000 as foreign selling intensified.
Foreign investors sold a net 1.008 trillion won ($740 million) of KOSPI shares, while institutions unloaded 372.8 billion won. Retail investors bought a net 867.0 billion won.
The decline came despite gains on Wall Street on Friday, when renewed buying in artificial intelligence (AI)-related shares lifted all three major U.S. indexes. The S&P 500 rose 0.51 percent to 7,743.41, the Nasdaq Composite gained 0.48 percent to 27,068.72, and the Dow Jones Industrial Average climbed 0.93 percent to 51,828.62.
Elevated U.S. Treasury yields continued to weigh on sentiment. The benchmark 10-year yield ended Friday around 5.17 percent after touching the 5.2 percent range during the Korean holiday, its highest level since 2007. Still, U.S. chip shares remained resilient, with the Philadelphia Semiconductor Index rising 1.41 percent.
Oil prices also remained volatile. Brent crude and West Texas Intermediate (WTI) fell sharply Friday as hopes for increased Middle East supply eased concerns over disruptions, but both rebounded in Asian trading Monday after U.S. President Donald Trump rejected an Iranian peace proposal aimed at ending the conflict and reopening the Strait of Hormuz. Brent rose 1.27 percent to $105.64 a barrel, while WTI gained 0.76 percent to $93.11.
The U.S.-China summit offered some relief but no major breakthrough. Trump and Chinese President Xi Jinping agreed to extend their trade truce by two months, while key issues over tariffs, technology restrictions, artificial intelligence and Taiwan remained unresolved.
Against that backdrop, selling was concentrated in Korea's chip heavyweights.
Samsung Electronics fell 3.50 percent to 275,500 won Monday morning, while SK hynix dropped 4.03 percent to 1,787,000 won. Samsung Electronics' preferred shares slid 4.32 percent to 210,500 won.
Selling also hit other chip-linked shares. SK Square, the largest shareholder of SK hynix, dropped 5.97 percent to 1,119,000 won. Samsung Electro-Mechanics bucked the weakness, rising 0.66 percent to 1,517,000 won.
Other large-cap shares were mostly higher. LG Energy Solution gained 3.98 percent to 365,500 won, while Hyundai Motor rose 0.85 percent to 356,500 won. Samsung Biologics advanced 1.83 percent to 1,391,000 won.
KB Financial added 0.52 percent to 174,100 won, while Samsung Life Insurance edged up 0.17 percent to 295,000 won.
The KOSDAQ moved in the opposite direction, rising 11.75 points to 856.23 as of 10:40 a.m.
Foreign investors bought a net 74.2 billion won of KOSDAQ shares and institutions purchased 11.2 billion won. Retail investors sold a net 91.8 billion won.
Among its largest stocks, Alteogen, which develops drug-delivery platforms that can convert intravenous treatments into subcutaneous injections, rose 2.80 percent to 257,000 won.
Battery-related shares also advanced. EcoPro, the holding company of a battery materials group, gained 2.12 percent to 81,800 won, while cathode-materials maker EcoPro BM climbed 3.62 percent to 108,800 won.
Semiconductor and display equipment stocks were mixed. Jusung Engineering rose 0.95 percent to 211,500 won, while Wonik IPS fell 4.19 percent to 128,100 won. Laser equipment maker EO Technics slipped 0.10 percent to 481,000 won.
Rainbow Robotics, which develops collaborative, mobile and humanoid robot platforms based on technology from humanoid robots, fell 1.04 percent to 428,500 won.
The Korean won weakened to 1,361.50 per dollar from 1,358.40 on Sept. 23, before the Chuseok holiday.
Across the region, markets diverged as investors balanced support from technology shares against pressure from higher oil prices and elevated U.S. Treasury yields. Japan's Nikkei 225 edged up 0.19 percent to 66,490.33, while Hong Kong's Hang Seng Index gained 0.87 percent to 24,723.54. China's Shanghai Composite fell 0.79 percent to 3,857.68.
Investors are now turning to a heavy slate of economic data and corporate earnings later this week. Micron Technology is scheduled to report quarterly results after the U.S. market closes Wednesday. The U.S. personal consumption expenditures (PCE) price index is scheduled for release the same day.
The September employment report is scheduled for Friday, while South Korea is set to release August industrial activity data Wednesday.
AJP Takeaways
- The KOSPI fell 2.04 percent to 6,936.34 as of 10:56 a.m. Monday, dropping further below 7,000 as foreign investors sold a net 1.008 trillion won ($740 million) of shares.
- Samsung Electronics and SK hynix fell 3.50 percent and 4.03 percent, respectively, as elevated U.S. Treasury yields and renewed oil-market volatility weighed on sentiment despite gains in U.S. technology shares.
- The KOSDAQ moved in the opposite direction, rising to 856.23 as foreign and institutional investors remained net buyers, while markets also looked ahead to Micron Technology earnings, U.S. PCE inflation data and the September jobs report.
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