The KOSPI showed a strange market, jumping more than 1,000 points in a day to reclaim the 6,500 level in one swoop. Three of the top five stocks by market cap on the Korea Exchange hit their daily upper limit during trading. Despite the sharp rebound in the index, individuals, with sentiment still dampened, hurried to dump more than 8 trillion won, while foreigners bought more than 7 trillion won, producing a turbulent session.
On the 31st, the KOSPI finished at 6,595.49, up 1,001.89 points (17.91%) from the previous session. Both the gain and the percentage rise were a record high. After surging more than 14% right after the open, the KOSPI extended its intraday rise to 18.54%, soaring to as high as 6,630.77.
The KOSDAQ also rose more than 10% early in the session, triggering buy-side sidecars on both markets six minutes after the open. Since the start of the year, buy-side sidecars have been activated 44 times on the main bourse and 28 times on the KOSDAQ. In particular, they were triggered for the 15th and 12th time, respectively, this month alone, underscoring the extreme volatility.
As the index jumped unusually, an abnormal market also unfolded in which three of the top five KOSPI market-cap stocks hit their daily upper limit during trading. In the morning, SK Square(402340) and Samsung Electro-Mechanics reached the upper limit, and in the afternoon, SK hynix, the No. 2 by market cap, hit the limit for the first time. Samsung Electronics(005930), the top stock by market cap, also jumped as much as 28.99% intraday.
Flows also set new records. Foreigners were net buyers of 7.2 trillion won on the main bourse, while individuals were net sellers of 8.25 trillion won. Both the foreigners' daily net purchases and individuals' daily net sales were the largest ever. Institutions were also net buyers of 1.15 trillion won.
As SK hynix hit the upper limit for the first time ever, single-stock leveraged products based on it as the underlying also posted unprecedented surges. "SOL SK hynix Single-Stock Leverage" jumped 59.93% to end at 9,260 won.
Conversely, the single-stock inverse 2x product that bets twice on a decline in SK hynix plunged to the lower limit. "SOL SK hynix Futures Single-Stock Inverse 2X" tumbled 59.95% to close at 7,695 won. With the one-day returns of products tracking the same underlying splitting in opposite directions, the gap widened to about 120 percentage points.
The stock market surge is seen as stemming from overnight signs that U.S. big tech corporations delivered solid results and reaffirmed plans to ramp up investment in artificial intelligence (AI). As Microsoft (MS) and Amazon posted cloud results that topped market expectations, hopes grew that big tech's AI data center investment is translating into actual sales growth.
Chey Tae-won, chairman of SK Group, buying SK hynix shares is also seen as having spurred investor sentiment. Chey disclosed that on the 30th he bought 3,620 common shares of SK hynix on the open market for about 4.9 billion won. He purchased the shares for just under 5 billion won, the maximum that can be bought immediately without being subject to the rule requiring a pre-disclosure 30 days before the transaction.
Lee Kyung-min, a researcher at Daishin Securities, said, "As expectations grow that big tech's AI infrastructure investment will continue, concerns about AI investment and semiconductor conditions have eased," and added, "With news that Situational Awareness, which had expanded leveraged bets on AI-related stocks, is selling its portfolio, the perception has spread that the deleveraging that amplified the recent plunge in semiconductor and AI infrastructure stocks is nearing its end."
Meanwhile, the KOSDAQ, which had fallen to the 640 level recently, also reclaimed the 700 level on the day. The KOSDAQ index closed at 719.76, up 74.98 points (11.63%) from the previous session. On the KOSDAQ market, foreigners and institutions were net buyers of 170 billion won and 290 billion won, respectively. Individuals alone were net sellers of 470 billion won.
With semiconductor stocks leading gains, Jusung Engineering(036930), Wonik IPS, PSK, and other semiconductor materials, parts, and equipment names also posted strong rises in the 20% range.