SEOUL, September 30 (AJP) - South Korean stocks fell for a third straight session Wednesday as heavy foreign and institutional selling erased early gains in chip shares fueled by optimism over artificial intelligence (AI) infrastructure spending. The KOSDAQ bucked the decline as semiconductor equipment and battery shares advanced.
The benchmark KOSPI fell 0.48 percent, to close at 6,838.04. It opened 1.06 percent higher than the previous session's close at 6,943.47 and climbed as high as 6,965.64 before reversing course as selling intensified. The index briefly fell to 6,818.39 in afternoon trading.
The early gains faded as persistently high U.S. Treasury yields and heavy foreign selling outweighed support from an overnight drop in oil prices and strength in semiconductor shares. Investors also turned cautious ahead of Micron Technology's earnings, a key gauge of demand for AI-related memory chips.
Foreign investors sold a net 2.05 trillion won ($1.52 billion) of KOSPI shares, while institutions unloaded about 768 billion won ($568 million). Retail investors bought a net 1.17 trillion won ($866 million).
Foreign selling has remained heavy since the Chuseok autumn harvest holiday, with overseas investors unloading nearly 9 trillion won of KOSPI shares over the past three sessions.
The market had opened higher as gains in U.S. semiconductor shares and expectations for continued AI infrastructure spending boosted chip-related sentiment. Those expectations were reinforced by Anthropic's initial public offering (IPO) filing, which outlined plans to commit at least $518 billion to computing and AI infrastructure over the next decade.
Chip shares also gave back some of their early gains as the session progressed.
Samsung Electronics rose as high as 276,000 won during the regular session before falling 1.47 percent to close at 268,500 won. SK hynix touched 1,824,000 won, up 3.34 percent intraday, before trimming its gain to close 0.62 percent higher at 1,776,000 won.
SK Square, the largest shareholder of SK hynix, was also up 1.61 percent at 1,136,000 won, while LG Energy Solution gained 0.85 percent to 355,500 won. Samsung Biologics added 0.43 percent to 1,391,000 won.
By contrast, Samsung Electro-Mechanics was down 0.65 percent to 1,518,000 won, while Hyundai Motor fell 1.00 percent to 346,500 won. KB Financial Group lost 2.42 percent to 169,300 won and Samsung Life Insurance was down 2.93 percent at 282,000 won.
Samsung Electronics preferred shares remained among the weakest large caps, trading 3.53 percent lower at 196,800 won after falling sharply during the regular session.
The KOSDAQ moved in the opposite direction.
The junior index rose 0.72 percent to close at 855.91, supported by gains in semiconductor equipment, battery and biotechnology stocks. Institutions bought a net 48.8 billion won and retail investors purchased 11.8 billion won, while foreign investors sold about 67.7 billion won.
Semiconductor equipment shares remained strong into the after-market session.
EO Technics, a maker of laser-processing equipment used in semiconductor, display and printed-circuit-board production, was up 4.54 percent at 518,000 won as of 4:25 p.m.
Jusung Engineering, which makes deposition equipment for semiconductor manufacturing, climbed 4.50 percent to 232,000 won.
Wonik IPS, a semiconductor and display equipment maker, gained 0.84 percent at 131,400 won.
Battery-related shares also held onto gains. EcoPro rose 2.03 percent to 80,400 won. The company operates as the holding company of a battery-materials group.
EcoPro BM, which specializes in cathode materials used in rechargeable batteries, advanced 2.54 percent to 108,800 won.
Alteogen, a biotechnology company that develops biologic drug technologies, was up 0.99 percent at 256,000 won.
Rainbow Robotics, which develops collaborative, mobile and humanoid-based robot platforms, gained 0.72 percent to 419,500 won.
The divergence between the two indexes reflected a market in which selling remained concentrated in large KOSPI names while investors continued to seek selected AI equipment, battery and biotechnology shares on the junior market.
The Korean won strengthened to 1,351.80 per dollar compared with 1,356.7 in the previous session.
Across the region, major Asian markets mostly advanced. Japan's Nikkei 225 advanced 1.94 percent to 66,753.72, while Hong Kong's Hang Seng Index rose 0.37 percent to 24,613.27.
Mainland China's Shanghai Composite gained 0.31 percent to 3,842.19, supported by improving factory activity and government measures to support lending and stabilize the property market.
Rate-hike expectations eased somewhat after New York Fed President John Williams said there was no urgency for another increase at the October Federal Open Market Committee (FOMC) meeting.
Investors are now watching the U.S. personal consumption expenditures (PCE) price index, due at 9:30 p.m. Korea time, and Micron Technology's earnings, scheduled for early Thursday morning, for clues on the Federal Reserve's policy outlook and AI-related memory demand.
AJP Takeaways
- The KOSPI fell 0.48 percent to 6,838.04, extending its losing streak to three sessions as foreign and institutional selling erased an early 1 percent rally.
- Foreign investors sold about 2.05 trillion won of KOSPI shares Wednesday, taking their cumulative selling over the past three sessions to nearly 9 trillion won.
- In KRX after-market trading as of 4:25 p.m., Samsung Electronics traded at 269,500 won, down 1.10 percent from the previous close, while SK hynix rose 1.08 percent to 1,784,000 won.
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