South Korean equities surged sharply on Thursday morning, propelled by optimism regarding potential peace talks between Washington and Tehran. The rally saw the benchmark Korea Composite Stock Price Index (KOSPI) climb significantly, driving major sectoral gains across the market.
The KOSPI added 132.06 points, marking a 2.17 percent increase, reaching 6,223.45 as of 11:20 a.m. local time. The positive market sentiment followed reports of renewed negotiations being arranged by a Pakistani delegation in Tehran.
U.S. President Donald Trump had previously stated that the U.S.-Israeli war against Iran was "very close to over." This commentary, coupled with White House confirmation that further talks "would very likely" take place, fueled the positive market momentum.
Key Sectors Drive Major Gains in Korean Equities
Sector-specific breakouts were evident across the market, led notably by technology, automotive, and shipbuilding industries. Tech giant Samsung Electronics rose robustly by 3.08 percent, while SK hynix appreciated by 1.85 percent, indicating strong investor confidence in the semiconductor space.The automotive sector also delivered stellar performance. Hyundai Motor advanced a substantial 6.1 percent, closely followed by its sister company, Kia, which saw gains of 4.75 percent.
In the industrial heavyweights segment, major shipbuilders benefited from the uptrend. HD Hyundai Heavy Industries added 4.21 percent, and Hanwha Ocean climbed 3.5 percent. Defence shares were mixed, with Hanwha Aerospace up 0.73 percent, while LIG D&A fell 1.79 percent.
Foreign Investment Activity Signals Caution Amid Global Rally
Despite the impressive market rally, data revealed a pattern of caution from foreign investors. Offshore investors net sold a substantial amount of local stocks in March, reaching 43.51 trillion won, or US$29.5 billion. This marked the highest monthly net sale recorded for the local market.The sell-off was spearheaded by investors from Britain, who net sold 16.3 trillion won worth of shares. Investors from the United States also contributed to the outflow, net selling 9.5 trillion won.
Following the net selling in March, offshore investors maintained a significant ownership stake, controlling 1,576.2 trillion won worth of local stocks, equating to 30.7 percent of the total market capitalization.
The local currency, the won, traded at 1,473.45 won against the greenback by 11:20 a.m., showing a modest increase of 0.75 won from the previous session.
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