(URGENT) Seoul shares end higher on institutional buying amid AI investment concerns

Seoul shares ended higher on Monday, buoyed by institutional investment as investors grappled with worries over the profitability of substantial investments in artificial intelligence (AI) infrastructure. The Korean won strengthened against the U.S. dollar. After opening 3.17% lower, the KOSPI index rebounded to close up 99.96 points, or 1.76%, at 5,768.01, down from its lowest point of 5,488.41.

Institutions purchased a net 574.66 billion won (USD 432 million) worth of shares, while foreign investors and retail investors collectively sold a net 37.87 billion won and 1.09 trillion won, respectively. Concerns persisted as investors awaited earnings from major companies, including Tesla and Meta Platforms, and the U.S. midterm elections scheduled for Nov. 3, adding to market uncertainty regarding interest rate prospects, according to analysts.

Some investors turned to large-cap stocks in search of bargains following sharp declines over recent weeks, contributing to the index's positive sentiment despite the lingering concerns over AI infrastructure spending. Tech stocks, led by Samsung Electronics and SK hynix, played a role in the gains. Samsung Electronics rose 1.16% to 218,000 won, while SK hynix climbed 0.39% to 1.28 million won.

Leading carmaker Hyundai Motor surged 4.49% to 326,000 won, and defense company Hanwha Aerospace increased 1.91% to 905,000 won. Conversely, shipbuilding giants HD Hyundai Heavy Industries and Hanwha Ocean experienced declines, with the former falling 1.71% to 345,500 won and the latter dropping 1.23% to 64,200 won.

The Korean won closed at 1,330.3 per U.S. dollar, up from 1,331.4 at the close of the previous session. Bond prices, which inversely correlate with yields, fell; the yield on three-year Treasuries rose 2.3 basis points to 3.877%, while the return on the benchmark five-year government bonds climbed 2.6 points to 4.014%.