Korea’s main Kospi rebounds to above 2,550 led by chip stocks

[Photo by MK DB]

South Korea’s benchmark Kospi bounced back to above 2,550 points Monday on the back of upbeat chip stocks despite growing uncertainty surrounding U.S. debt ceiling negotiations.

The Kospi stood at 2,557.54 as of 10:55 a.m. Monday, up 0.78 percent from the previous session’s closing, after opening at 2,540.03, up 0.09 percent.

Kospi headed north for six straight trading sessions.

Foreigners and institutions net purchased 27.8 billion won ($21 million) and 40.3 billion won worth of shares in the Kospi, respectively, while individuals net sold 67.4 billion won in the morning.

Chip stocks gained ground.

Shares of market bellwether Samsung Electronics Co. rose 0.73 percent to 68,900 won as of 10:55 a.m. while SK hynix Inc. surged 1.85 percent to 99,100 won.

“The upward momentum is being led by a supply shift toward chip stocks from secondary battery stocks,” said Han Ji-young, an analyst at Kiwoom Securities Co.

“Despite the uncertainty in the macro environment that is directly linked to the front demand for chip stocks, the ongoing progress in artificial intelligence and a higher prospect for recovery in earnings are serving as an upbeat factor for chip stocks,” Han added.

The uncertainty over the debt ceiling negotiations in the U.S. is still a concern.

Marker insiders are paying attention to whether the negotiations will continue as the U.S. President Joe Biden and top Republican Kevin McCarthy have spoken on the phone to end the impasse over raising the U.S. federal debt ceiling.

Han said that future developments in the negotiations can cause potential stock fluctuations.

Of the top stocks, Celltrion Inc. gained 2.24 percent and Samsung Biologics Co. 1.16 percent.

Construction stocks surged 3.54 percent, machinery 1.61 percent, and pharmaceutical 1.2 percent. Precision medical stocks, on the other hand, fell 0.42 percent.

The secondary Kosdaq index rose 0.96 percent to 849.79 Monday morning after opening at 840.97.

Retail investors net purchased 56.2 billion won while foreigners and institutional investors net sold 53.4 billion won and 3 billion won, respectively.

Shares of Alteogen Inc. were up 2.97 percent, EcoPro Co. 2.07 percent, and Celltrion Healthcare Co. 1.08 percent.