South Korean Shares Surge 4.6 Percent to Five Week High on AI Optimism

South Korean shares surged 4.61 percent on Monday, with the benchmark Korea Composite Stock Price Index (KOSPI) closing at 6,995.39. This marks the highest closing since July 23 and extends a winning streak to three sessions. The rally was driven by the launch of OpenAI's new GPT-6 Astra model, which investors expect will increase demand for memory chips and potentially usher in the era of artificial general intelligence.

Semiconductor stocks saw significant gains. Samsung Electronics rose 5.68 percent to 270,000 won, while SK hynix soared 8.26 percent to 1.78 million won. Other winners included SK Square, which rose 8.07 percent, and Hanmi Semiconductor, which climbed 4.57 percent. Gains were also seen in the automotive sector, with Hyundai Motor adding 2.48 percent and Hyundai Mobis rising 2.37 percent. Bank shares were bullish, as Hana Financial Group and Shinhan Financial Group advanced 3.43 percent and 3.26 percent, respectively.

Market activity was characterized by a divide in investor behavior. Foreign and institutional investors were net buyers, purchasing 2.55 trillion won and 2.64 trillion won, respectively. In contrast, individual investors sold a net 6.83 trillion won. Trade volume was light at 237.9 million shares worth 21.5 trillion won. The Korean won also strengthened, rising 9.9 won to 1,340.5 won against the U.S. dollar. Analysts noted that the positive sentiment persisted despite sluggish performance from major tech and software shares on Wall Street.