South Korea’s benchmark index rose as easing tensions in the Middle East helped calm investor nerves. File Photo by Thomas Maresca/UPI | License Photo
South Korea’s benchmark stock index KOSPI rose almost 3% Tuesday, topping the 3,100-point mark for the first time in 45 months, as easing tensions in the Middle East helped calm investor nerves.
The last time the KOSPI reached 3,100 points was on Sept. 28, 2021.
Share prices surged on the Seoul bourse after U.S. President Donald Trump announced that Iran and Israel had agreed to a cease-fire. Foreign investors recorded net purchases of $320 million.
In particular, the market capitalization of SK hynix rocketed 7.32% to nearly $150 billion thanks to the strong sales of its high-bandwidth memory chips, which are used in artificial intelligence applications and supercomputers.
SK hynix is South Korea’s second-most valuable listed company, following Samsung Electronics, whose market capitalization amounts to $263 billion.
Since the inauguration of President Lee Jae Myung on June 4, the KOSPI has jumped 15%, buoyed by the new administration’s pledge to boost the economy through various stimulus policies, including supplementary budgets.
Observers expect that the KOSPI may surpass the historic high of 3,316.08 points, recorded on June 25, 2021, in the near future.
“Both Washington and Seoul are expected to provide more liquidity to the market through interest rate cuts. Hence, more money will flow into the stock market,” NH Investment & Securities analyst Kim Young-hwan told UPI.
“Especially, the Korean government is working to underpin the economy through extra budgets and pump-priming measures. The stock market appears to have upward momentum to approach the historic peak,” he expected.
