Seoul Shares Close Higher as Retail Investors Buy Following Market Plunge

The benchmark Korea Composite Stock Price Index (KOSPI) closed 1.62 percent higher at 6,358.95 on Tuesday, gaining 101.50 points. The increase followed a session on Monday where the index tumbled 5.12 percent, which itself followed a record 18 percent surge on Friday. Retail investors drove the recovery by buying a net 818.4 billion won worth of stocks, while institutional and foreign investors sold a net 539.2 billion won and 370.56 billion won, respectively.

Market gains were capped by ongoing uncertainty regarding the Middle East crisis and the long term profitability of artificial intelligence investments. Tech stocks led the advance, with Samsung Electronics rising 0.21 percent to 240,000 won and SK hynix climbing 0.64 percent to 1,577,000 won. Defense stocks saw significant jumps, including Hanwha Aerospace at 9.25 percent and Korea Aerospace Industries at 11.16 percent. Conversely, Hyundai Motor fell 0.13 percent and Korean Air declined 0.38 percent.

Overnight gains on Wall Street provided a positive backdrop, with the Dow Jones Industrial Average rising 1.32 percent and the Nasdaq composite climbing 2.13 percent. Amazon shares rose 4.5 percent following strong earnings. In currency markets, the Korean won fell 2.9 won against the U.S. dollar to close at 1,432.5 won. Bond prices closed higher, with the yield on three year Treasurys falling 0.2 basis point to 3.740 percent.