SEOUL, November 9 (AJP) — South Korea’s won strengthened alongside the Japanese yen Monday despite continued foreign selling of Korean equities as exporters’ dollar conversions helped cushion the currency against concerns over slowing AI investment.
The divergence reflects two different forces: stock investors are reassessing future semiconductor earnings, while exporters are still converting dollars earned from strong overseas sales.
The won closed daytime trading at 1,347.1 per dollar, strengthening 9.5 won from Friday and recovering from an opening level of 1,363.0.
“Exporters and other market participants waited until the exchange rate reached the 1,360s before converting their dollars,” a FX dealer at a foreign bank in Seoul noted.
The dealer said exchange rates in the low-to-mid 1,300s had offered relatively little incentive for conversions. Strong export earnings should continue to supply dollars, potentially supporting the won unless another sharp stock market decline unsettles financial conditions.
Regional currencies moved unevenly. The dollar slipped 0.25 percent against the yen to 158.08 yen in Tokyo trading as of 4 p.m., according to the Financial Supervisory Service’s afternoon market report. Against China’s yuan, it edged up 0.03 percent to 6.6752.
The won’s resilience illustrates why foreign stock selling does not necessarily produce an equivalent currency decline. Equity sales and currency conversions can occur at different times, while exporters’ dollar sales can offset demand from investors withdrawing funds.
For now, trade receipts are providing support even as confidence in the stock market remains fragile.
The KOSPI fell 0.81 percent to 5,018.9, bringing its decline since the end of October to 12.42 percent. It nevertheless remained 19.09 percent above its 2025 closing level.
Foreign investors sold a net 625.7 billion won of KOSPI shares, with their cumulative net selling reaching 11.7 trillion won already this month.
Korea’s continued losses contrasted with rebounds in Japan and Taiwan. The Nikkei 225 climbed 2.33 percent to 58,775.5, while Taiwan’s benchmark surged 4.94 percent to 41,661.7. Both remained below their end-October levels, by 7.13 percent and 7.85 percent, respectively.
China’s Shanghai Composite rose 0.32 percent to 3,660.8 and Hong Kong’s Hang Seng edged up 0.09 percent to 24,503.0.
Korea’s inability to join the rebound suggests that the recovery in technology sentiment abroad had yet to overcome selling pressure at home.
The anxiety reaches Korea through two channels: the volume of memory chips customers buy and the prices they are willing to pay.
Samsung Electronics and SK hynix supply high-bandwidth memory used alongside AI processors, as well as server DRAM and storage. Both companies have tied their growth outlooks closely to AI infrastructure spending.
A delay in data center construction could therefore unsettle expectations across several product lines at once.
The risk extends beyond cancelled orders. If customers postpone purchases while manufacturers continue expanding capacity, expectations of tight supply and strong pricing can weaken. Investors may then mark down future profits before any slowdown appears in shipments. That makes memory stocks sensitive to changes in the expected pace of AI investment, even while current earnings remain strong.
Samsung and SK hynix’s prominent role in Korea’s stock market magnifies that sensitivity.
A reassessment of two companies can become a reassessment of Korean equities more broadly.
Japan’s exposure is spread across a wider range of industries, while Taiwan also faces substantial AI investment risk. Its rebound Monday shows that investors were not selling all Asian technology markets indiscriminately.
But weaker chip valuations need not immediately undermine the won.
Shares reflect expectations for future orders and margins; the currency also responds to dollars arriving from sales already made. Exporters can therefore support the won even as foreign investors reduce their equity holdings.
The more consequential turning point would come if doubts about data center spending began to weaken actual export receipts.
The larger rise in the shorter maturity narrowed the gap between the two yields to 22.4 basis points from 24.0 basis points. That modest flattening was consistent with greater sensitivity to near-term monetary policy expectations.
Japan’s 10-year government bond yield rose 1.1 basis points to 2.665 percent. The U.S. 10-year Treasury yield had increased 2.27 basis points to 4.857 percent in the preceding business session.
Still, Korean three-year and 10-year yields remained 7.6 and 14.5 basis points below their end-October levels. Monday’s increase therefore represented a partial reversal of the recent bond rally.
The distinction between an equity correction and an export slowdown remains crucial for the won. Investors can cut their valuations of chipmakers well before any deterioration appears in export receipts.
Those receipts are providing a cushion today. Whether that cushion lasts will depend on whether concerns over AI spending eventually translate into weaker orders and shipments.
Copyright ⓒ Aju Press All rights reserved.