The benchmark KOSPI rose 4.39 percent to close at 5,239.13.
Foreign investors bought 407 billion won (US$305 million) worth of shares, as institutions purchased 477.1 billion won. Retail investors sold 1.37 trillion won, taking profits following the sharp rebound.
The index briefly climbed above 5,300 in early trading, triggering a buy-side trading curb at 9:06 a.m. that suspended program buy orders for five minutes.
A similar curb was activated on the KOSDAQ four minutes later as buying accelerated across both markets.
The rebound followed three consecutive sessions of losses driven by concerns over tighter U.S. regulation of artificial intelligence data centers following the Democratic Party's sweeping victory in the midterm elections last week.
Investor sentiment improved after U.S. technology stocks rallied overnight, supported by bargain hunting and declining oil prices.
The Nasdaq Composite climbed 2.74 percent, while the S&P 500 gained 2.35 percent and the Dow Jones Industrial Average advanced 2.15 percent.
Semiconductor stocks led the recovery, with the Philadelphia Semiconductor Index jumping 6.86 percent. AMD surged 13.26 percent, Broadcom gained 8.78 percent and Micron Technology rose 6.25 percent, helping ease concerns over the outlook for AI-related investments.
The recovery extended to South Korea's two largest memory chipmakers. SK hynix climbed 6.95 percent to 1,215,000 won, while Samsung Electronics rose 4.9 percent to 199,200 won.
The gains helped both companies recover part of the losses suffered during last week's selloff, when concerns over artificial intelligence (AI)-related infrastructure spending and the profitability of data center operators prompted heavy selling.
SK Square, a major shareholder in SK hynix, gained 5.4 percent to 761,000 won.
Samsung Electronics' preferred shares advanced 5.83 percent to 159,700 won.
Despite the rebound, investors remained cautious ahead of U.S. inflation data and quarterly earnings from CoreWeave, a major AI cloud infrastructure provider.
CoreWeave has attracted particular attention because of its heavy borrowing and substantial spending on data center equipment, making its earnings an important test of whether AI infrastructure investment remains financially sustainable.
Other technology-related shares also advanced. Samsung Electro-Mechanics gained 4.98 percent to 885,000 won, while Samsung SDI jumped 9.4 percent to 454,000 won.
Power equipment makers posted strong gains as buying returned to companies linked to AI infrastructure investment.
Hyosung Heavy Industries surged 11.9 percent to 1,733,000 won, while HD Hyundai Electric climbed 10.7 percent to 394,000 won and LS Electric gained 8.2 percent to 120,800 won.
Airline shares also rallied as declining oil prices raised expectations of lower fuel costs. Jin Air surged 29.9 percent to 7,990 won, while Korean Air jumped 11.5 percent to 32,450 won and Hanjin KAL gained 13 percent to 234,500 won.
Elsewhere on the KOSPI, Hanwha Ocean climbed 12.77 percent to 234,000 won, while Naver advanced 3.1 percent to 192,900 won. By contrast, Celltrion fell 2.86 percent to 204,000 won.
The tech-heavy KOSDAQ rose 4.5 percent to close at 667.61, after trading between 655.09 and 671.91.
Institutional investors bought 215.1 billion won worth of shares, while foreign investors sold a net 146.4 billion won. Retail investors followed foreign investors and unloaded 57.4 billion won.
Semiconductor equipment and component stocks led the recovery. Jusung Engineering surged 7.34 percent to 152,100 won, while Simtech jumped 7.21 percent to 107,100 won.
Wonik Holdings gained 7.35 percent to 29,200 won, while Wonik IPS rose 2.53 percent to 69,000 won. Alteogen recovered 4.45 percent to 175,900 won after suffering heavy losses in recent sessions.
Elice advanced 5.84 percent to 70,700 won, while EcoPro moved in the opposite direction, falling 4.83 percent to 63,000 won.
Other actively traded shares recorded strong gains, with Revelup climbing 18.4 percent to 13,000 won and Xgate jumping 12.74 percent to 13,010 won.
Asian Market showed elevation with Japan's Nikkei 225 rose 2.9 percent to 60,459.58, while Hong Kong's Hang Seng Index gained 0.3 percent to 24,522.99. China's Shanghai Composite edged up 0.08 percent to 3,663.72.
The South Korean won strengthened 0.4 percent to 1,336.4 won per dollar.
Oil prices extended their decline as diplomatic efforts to end the conflict between the United States and Iran raised hopes of easing supply disruptions in the Middle East.
West Texas Intermediate crude fell 1.5 percent to $85.56 a barrel, while Brent crude declined 1.5 percent to $91.14.
The decline followed remarks by U.S. President Donald Trump expressing optimism over progress toward a negotiated settlement after meeting Qatar's prime minister.
However, continued military tensions near the Strait of Hormuz and uncertainty over Iran's negotiating position kept supply risks elevated.
Investors are also awaiting monthly oil market reports from the U.S. Energy Information Administration, OPEC and the International Energy Agency for further indications of global supply and demand trends.
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