South Korean stocks opened lower Monday and were down about 1.5% by mid-morning, extending a slide that closed last week at a three-session low. According to Yonhap, the KOSPI was at 6,527.60 at 9:45 a.m., down 98.33 points, or 1.48%, from Thursday's close of 6,625.93. The exchange was shut Friday for a holiday, and the move through 6,530 in the next half hour was still early-session trading, not a close. Higher oil prices and fresh Middle East strikes outweighed gains on Wall Street, with the Dow rising 0.83% and the Nasdaq gaining 0.64% on Friday.
Technology shares led the decline as investors assessed potential energy-supply and inflation risks. Samsung Electronics was down 0.95% and SK Hynix fell 2.71% in the latest trading snapshot, according to Yonhap. Among other major stocks, Hanwha Aerospace dropped 2.13% and HD Hyundai Heavy Industries declined 4.04%. However, Hyundai Motor rose 1.46%, while LG Energy Solution edged up 0.25%, bucking the broader market weakness. The technology sector's underperformance reflects investor concerns about potential disruptions to global energy supplies and their impact on semiconductor demand.
Foreign investors net-sold South Korean shares worth ₹604.8 billion, adding pressure on equities according to The Economic Times. This significant outflow contributed to the broader market decline as foreign investors returned to the market after the extended weekend break. The continued foreign selling reflects ongoing concerns about geopolitical tensions and their potential impact on the Korean economy.
Despite the equity market decline, the South Korean won strengthened against the US dollar, reaching its highest level since October 4, 2024. The currency was quoted at 1,338.65 to the dollar, firmer by 3.35 won from the previous stock-session close, as reported by Yonhap. In offshore trading, the won rose 0.3% to 1,335.6 per dollar, while its one-month non-deliverable forward contract stood at 1,334.6. The overnight lead was higher, not lower, indicating continued strength in the Korean currency.
South Korean government bonds also advanced, with December futures on three-year Treasury bonds gaining 0.18 points to 102.68. The yield on the most liquid three-year Treasury bond fell 4.8 basis points to 3.946%, while the benchmark 10-year yield declined 6.6 basis points to 4.328%, according to Reuters reports cited by The Economic Times. Despite Monday's decline, the KOSPI has gained 54.51% so far this year, while the won has strengthened 7.7% against the dollar over the same period.
