The KOSPI recovered the 4,100 level on expectations that the temporary U.S. federal government shutdown will end and on strength in semiconductor stocks. However, the gain was not large. It is seen as the result of investors dumping shares as the won's weakness persisted.
On the 11th, the KOSPI ended at 4,106.39, up 33.15 points (0.81%) from the previous day. It was the first time in five trading days that the KOSPI topped 4,100, since on the 4th (closing 4,121.74).
Overnight, U.S. stock indexes closed higher. Along with projections that the government shutdown will be wrapped up, remarks from the Trump administration about paying $2,000 in dividends from tariff revenue heightened expectations for liquidity expansion. Thanks to that, the domestic market also opened higher. Early in the session it even jumped close to 3%.
However, as the weak won continued and the won-dollar exchange rate topped 1,460 won against the U.S. dollar, market sentiment shifted. Foreign investors, feeling the exchange-rate burden, dumped shares. In the afternoon, the KOSPI turned lower and even slipped to the 4,066 level.
Fortunately, as foreigners turned to "buying," the KOSPI was able to finish the transaction higher. The intraday swing was wide.
In the main board, institutions and foreigners were net buyers of 224.1 billion won and 77.8 billion won, respectively. Only individuals sold, unloading about 283.3 billion won in stocks.
In the Seoul foreign exchange market at 3:30 p.m., it was 1,463.3 won, up 11.9 won from the previous day. The intraday break above 1,460 won was the first in about seven months since Apr. 10.
Large-cap semiconductor stocks stood out. Samsung Electronics and SK hynix rose 2.88% and 2.15%, respectively. SK hynix climbed as high as 646,000 won intraday, setting an all-time high. Elsewhere, LG Energy Solution and KB Financial gained in the 1% range.
By contrast, nuclear power and defense stocks struggled. Doosan Enerbility (-1.76%), Hanwha Aerospace (-1.76%), and HD Hyundai Heavy Industries (-0.74%) fell.
The KOSDAQ failed to reverse higher and finished the transaction lower. The KOSDAQ index closed at 884.27, down 4.08 points (0.46%) from the previous session. The KOSDAQ rose to 903.09 early in the session, but after turning lower after 1 p.m., it failed to rebound.
On the KOSDAQ on the day, institutions were net sellers of about 82.2 billion won. Individuals and foreigners bought 76.4 billion won and 16.3 billion won, respectively.
Among the top 10 KOSDAQ stocks by market cap, most weakened except EcoPro (7.05%) and Sam Chun Dang Pharm (2.10%). PharmaResearch plunged more than 11%, and Peptron also fell in the 4% range. ABL Bio (-2.99%), Alteogen (-2.30%), LigaChem Biosciences (-2.16%), and Rainbow Robotics (-1.24%) also declined.
Lee Jae-won, a researcher at Shinhan Investment & Securities, said, "The rise in the won-dollar exchange rate was due to factors including the yen's weakness after Japanese Prime Minister Sanae Takaichi noted an expansion in fiscal expenditure," adding, "As the large-cap-led market resumed, the KOSDAQ's gains were limited by weakness in bio stocks."