Seoul Stocks Open Sharply Lower as Investors Lock in Profits After Record Surge
Key Takeaways
- •The KOSPI fell 4.25 percent to 6,315.4 on Monday as investors locked in profits after the index posted its sharpest single-day gain on record of roughly 17 percent the prior Friday.
- •Samsung Electronics declined 6.48 percent and SK hynix dropped 6.69 percent, with both semiconductor heavyweights amplifying the broader market's downward movement.
- •Monday's selloff occurred despite positive signals from Wall Street, where Amazon's strong cloud computing revenue growth of 37 percent had boosted investor sentiment around artificial intelligence.
- •President Trump announced that negotiations with Iran would resume after he called off a planned large-scale military attack, signaling reduced geopolitical tensions in the Middle East.
- •The Korean won appreciated 2.2 won against the US dollar, trading at 1,433.3 won per dollar during the session.
South Korean equities opened sharply lower on Monday as investors moved to lock in profits following a record-breaking rally in the previous session.
The benchmark Korea Composite Stock Price Index (KOSPI) opened 3.6 percent lower and continued to decline, falling 280.05 points, or 4.25 percent, to 6,315.4 as of 9:15 a.m.
The downward move came despite a rally on Wall Street on Friday, where robust earnings from Amazon fueled investor optimism surrounding the artificial intelligence sector. Revenue at Amazon's cloud computing unit surged 37 percent in the second quarter ending in June, exceeding market expectations.
"We may see investors attempt profit-taking early this week, as the benchmark KOSPI vaulted around 17 percent Friday, the sharpest single-day gain on record," said Han Ji-young, an analyst at Kiwoom Securities.
The KOSPI's unprecedented single-day jump on Friday came amid a broad global market rebound, which set the stage for Monday's pullback as market participants capitalized on gains.
Geopolitical tensions in the Middle East showed signs of easing. US President Donald Trump announced that talks with Iran would resume on Monday, following his decision to call off a planned "massive attack" on the country.
In Seoul, most large-cap shares traded lower. Chip giant Samsung Electronics fell 6.48 percent, while rival SK hynix declined 6.69 percent. The two semiconductor leaders, which carry substantial weight in the KOSPI due to their outsized market capitalizations, often amplify the index's direction on heavy trading days. Battery manufacturer LG Energy Solution dropped 4.27 percent, and major financial group KB Financial inched down 0.47 percent. Defense contractor Hanwha Aerospace bucked the broader trend, adding 0.55 percent.
In currency markets, the Korean won was quoted at 1,433.3 won against the US dollar, up 2.2 won from the previous session's close. (Yonhap)