South Korean shares set to snap seven-week losing streak on AI optimism

South Korean stocks appear poised to end a seven-week downtrend on Friday, soaring to their best level in three weeks on optimism surrounding artificial intelligence (AI). The KOSPI index surged 55.55 points, or 0.82%, to 6,868.89 as of 0132 GMT, after surging up to 2.9% earlier in the day. The index is now in its fifth consecutive day of gains, climbing 9.4% during the period following a 31% drop over the past seven weeks.

Market uncertainty has waned recently, with the volatility index at 56 on Friday, down from a record high of 98 in late June. The S&P 500 reached a record high on Thursday, propelled by gains in tech stocks, as lower-than-expected producer price inflation data suggested the Federal Reserve would not raise interest rates at its September meeting.

Among the KOSPI's major players, chipmaker Samsung Electronics slipped 0.37% after previously jumping over 2%, while SK Hynix rose 3.01%. Battery producer LG Energy Solution fell 1.37%, while Hyundai Motor and Kia Corp climbed 5.73% and 1.97%, respectively. POSCO Holdings increased 1.08%, while Samsung BioLogics declined 1.09%. Of the 903 issues traded, 453 rose while 420 fell.

Foreign investors bought shares worth 780.2 billion won (US$550.81 million) in total. The Korean won was valued at 1,416.3 per dollar on the onshore settlement platform, a 0.16% increase from the previous close of 1,418.6. In money and debt markets, September futures on three-year treasury bonds rose 0.04 point to 103.33. The yield on the most traded three-year Korean treasury bond fell by 0.6 basis points to 3.774%, while the benchmark 10-year yield dropped by 1.1 basis points to 4.282%.