The semiconductor rally
The Seoul Stock Exchange closed Wednesday's session up more than 6%, led by the semiconductor sector after SK hynix reported record quarterly earnings and announced a shareholder remuneration program. According to The Korea Herald, the benchmark Kospi gained 374.1 points, or 6.63%, closing at 6,012.44 after hitting an intraday high of 6,032.28.
The move was triggered by the third-quarter results of the world's second-largest memory chipmaker, which posted unprecedented revenue and operating profit thanks to sustained chip demand linked to the artificial intelligence wave. The company also announced a shareholder return plan for 2026 worth more than 100 trillion won, equivalent to about $75.3 billion at the exchange rate cited by the source.
The sidecar and capital flows
The rally in technology stocks triggered the so-called 'buy-side sidecar' of the Korea Exchange shortly before 11 a.m., suspending program-trading buy orders on Kospi-listed stocks for five minutes. The mechanism is activated when Kospi 200 futures rise by at least 5% and remain at that level for at least one minute; according to the source, it was triggered for the second consecutive session.
On the flows side, foreign and institutional investors bought a net 815.83 billion won and 960.79 billion won, respectively, while individual investors sold a net 1.8 trillion won. Volumes were described as light: 223.2 million shares for 19.83 trillion won, with 580 stocks rising against 288 falling.
Standout stocks and currency market
Among major stocks, Samsung Electronics gained 9.01% to 242,000 won and SK hynix rose 10.89% to 1.49 million won. SK Square, SK hynix's parent company, advanced 11.23% to 921,000 won, while Samsung Electro-Mechanics rose 8.74% to 1.3 million won.
The Korean won weakened against the dollar, standing at 1,337.7 won as of 15:30, down 10.7 won from the previous close. Bond prices, which move opposite to yields, closed lower: the yield on three-year government bonds rose 4.1 basis points to 3.799%, and that on five-year bonds rose 5 basis points to 3.949%.
According to Lee Jae-won, an analyst at Yuanta Securities cited by the source, SK hynix has shown that strong AI chip demand can translate into solid operating profits and shareholder returns, easing concerns about the sustainability of the AI-driven rally and a possible peak in the memory cycle. The market is also awaiting the Federal Reserve's rate decision, expected in the early morning of Thursday, Korean time.
