- The Korea Composite Stock Price Index (KOSPI) closed up 3.55% on Friday at 8,476.15 points, reaching a historic high, mainly driven by a surge in shares of chip giant Samsung Electronics and a strong boost from the national pension fund's decision to increase its domestic stock investment target.
- Technology heavyweights led the market rally, with Samsung Electronics announcing it has provided samples of its latest high-bandwidth memory (HBM) chips to customers, securing a leading position in the critical AI supply chain, which spurred its stock price up by 5.84%.
- The currency and bond markets showed a linkage, with the Korean won weakening against the US dollar to 1,506.5 on the settlement platform, while the three-year and ten-year government bond yields collectively declined, indicating pricing adjustments in cross-border funds and the local sovereign bond market.
Pension Fund Policy Marginal Shift
The National Pension Service (NPS) of Korea recently decided to increase its target holdings of domestic stocks, a marginal policy change that became a key catalyst driving today's market sentiment. Previously, there was widespread concern that the agency would continue to reduce its domestic stock holdings to adjust its global asset allocation portfolio. Citi economist Kim Jin-wook analyzed that as the risk of large-scale asset sales to adjust the portfolio diminishes, the probability of the sovereign pension fund maintaining an overweight position in domestic stocks over a longer cycle has significantly increased, providing a solid valuation floor for core local assets.
AI Chip Supply Chain Marginal Breakthrough
As a global semiconductor industry bellwether, Samsung Electronics (005930) performed strongly in today's trading, closing up 5.84%. The company revealed it has begun distributing samples of its latest high-bandwidth memory chips to customers, which are crucial for the construction of current global AI data centers. Analysts believe that if the mass production progress of this key product continues to lead competitors, it could redefine the global competitive landscape in the AI storage chip sector. Meanwhile, fellow chip manufacturer SK Hynix (000660) also recorded a 1.92% increase, jointly driving the technology sector higher.
Valuation Recovery of Heavyweight Assets
Apart from the semiconductor sector, other core industrial heavyweight stocks in the Korean market also showed a broad upward trend. Battery manufacturing leader LG Energy Solution (373220) closed up 3.62%, while automotive giants Hyundai Motor (005380) and Kia Motors (000270) rose by 6.79% and 2.98%, respectively. Despite a net foreign sell-off of 10,420.99 billion won throughout the day, local institutions and pension fund buying remained dominant. Among the 922 stocks traded across the two markets, although 688 stocks fell, the strong surge of a few high-market-cap heavyweight stocks still led the index to a historic high.
Resonance of Cross-Border Capital and Bond Market Rates
While the stock market reached historic highs, the foreign exchange and bond markets exhibited different risk pricing. The Korean won closed at 1,506.5 against the US dollar today, down 0.78% from the previous trading day's 1,494.7, indicating exchange rate pressure amid net foreign capital outflows. In the fixed income market, the benchmark three-year government bond yield fell to 3.738%, and the benchmark ten-year government bond yield plummeted by 14.9 basis points to 4.059%. If core inflation data rebounds in the future, changes in the Korea-US interest rate differential may trigger a market repricing of the central bank's monetary policy path.
