Seoul shares rise on positive momentum from record high U.S. stocks

South Korean stocks closed higher Tuesday as investors scooped up undervalued shares after U.S. stock indexes closed at an all-time high overnight.

South Korean stocks experienced an uptick on Tuesday as investors seized opportunities in undervalued shares, buoyed by the stellar performance of U.S. stock indexes, which closed at an all-time high the previous night. The benchmark Korea Composite Stock Price Index (KOSPI) gained 0.58%, adding 14.26 points to reach 2,464.35. The positive momentum was reflective of a global trend, with the Korean won also strengthening against the U.S. dollar.

Trading activity saw moderate volumes, with 461 million shares valued at 7.87 trillion won ($5.89 billion) changing hands. Gainers outnumbered losers, with 482 stocks advancing compared to 379 declining. Foreign investors were net buyers, acquiring shares worth 137.9 billion won, while retail investors net sold 358.3 billion won. Institutions contributed to the overall positive sentiment by net buying 205.8 billion won worth of shares.

The surge in investor confidence was attributed to the U.S. stock market’s impressive performance, with the Dow Jones Industrial Average closing 0.36% higher, setting a new record. The S&P 500 and the Nasdaq also advanced, reaching fresh highs with gains of 0.22% and 0.32%, respectively.

Analysts noted that the positive sentiment from the U.S. markets contributed to a rebound in South Korean shares, particularly those that had recently experienced significant declines. Han Ji-young, an analyst from Kiwoom Securities, highlighted the potential for rebounds in shares that had undergone excessive setbacks.

Finance shares led the overall gains in the South Korean market, with KB Financial rising by 4.26% and Shinhan Financial advancing by 4.98%. KakaoBank also saw a notable increase, gaining 5.21%. Other sectors contributing to the positive momentum included leading cosmetics firm AmorePacific, which jumped 5.23%, and LG Chem, which gained 1.03%.

Tech shares, however, displayed mixed performance, with Samsung Electronics rising by 0.13% while SK Hynix, the second-largest chipmaker, declined by 1.26%. Battery makers showed strength, as LG Energy Solution rose by 0.4% and Samsung SDI climbed by 0.14%.

The won, the domestic currency, gained strength against the U.S. dollar, closing at 1,333.4 won, which reflects a rise of 5.5 won compared to the previous session’s closing rate. Overall, the positive market movements in Seoul were in line with broader global trends, emphasizing the interconnectedness of financial markets.