South Korea’s benchmark index achieved a Kospi record high on Tuesday amid easing geopolitical tensions. The index opened at 6,302.54, up 1.34 percent from the previous day. It quickly broke above its previous intraday high of 6,347.41. The Kospi then extended its gains to tap as high as 6,370 points. As of 2 p.m., the index stood at 6,364.82 for a 2.34 percent gain.
This Kospi record surpassed the previous peak set just before the Iran war outbreak. Foreign investors drove the rally with net purchases of 983.3 billion won. Institutions added 594.4 billion won to the upward momentum. However, retail investors sold off 1.47 trillion won during the session. Large cap stocks led the gains across the board.
Samsung Electronics rose 1.75 percent to close at 218,250 won. SK hynix advanced 4.46 percent to reach 1.21 million won. The chipmaker climbed past the 1.2 million won mark for the first time. It touched as high as 1.22 million won during trading. SK hynix will release its first quarter earnings on Thursday. Analysts expect a record operating profit exceeding 40 trillion won.
Hyundai Motor gained 2.85 percent to finish at 542,000 won. LG Energy Solution surged 10.02 percent to 472,000 won. Before the Middle East war, the Kospi had been on a blistering rally. It surged past the 6,300 mark in late February. Following the war outbreak, however, the index entered a volatile phase. It fell as low as 5,042.99 during trading on March 31. Trading curbs triggered as losses deepened and volatility escalated.
Since April, the index has staged a remarkable recovery. Risk appetite improved on hopes of easing geopolitical tensions. Foreign investment banks have turned increasingly bullish on the benchmark. Goldman Sachs raised its 12 month Kospi target to 8,000 from 7,000. The bank cited strong performance from upward earnings revisions. Robust AI related semiconductor demand is driving these gains. Nevertheless, Korean equities remain at a discount to global peers.
JPMorgan also raised its Kospi target to as high as 8,500. The bank had set a target of 7,500 in early February. It also raised its base case target to 7,000 from 6,000. The bank noted that key fundamentals of the Korean market remain on track. This opens up space for the Kospi to build further on recent momentum. Memory cycle conditions, governance reforms, and thematic growth support this view.
The Kospi record high reflects strong chip stock performance. SK hynix and Samsung Electronics have been leading the rally. However, JPMorgan warned about applying rules from previous cycles. The current memory cycle has unique characteristics, the report stated. Applying preemptive rules of thumb from past cycles requires care. It may be preferable to exit positions too late than too early. For now, the record signals renewed investor confidence. The index may continue its upward trajectory in coming weeks.
