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Kospi extends winning streak to third session as new administration encourages investors

Published: 05 Jun. 2025, 17:00 Updated: 05 Jun. 2025, 17:56

Kospi closes at 2,831.11 on June 5, the highest figure in 2025, a day after the inauguration of President Lee Jae-myung. In the picture is a worker at a Hana Bank branch in central Seoul. [NEWS1]

Korea’s stock markets extended their winning streak to a third consecutive session Thursday, buoyed by expectations for pro-growth and market-boosting policies from the new administration. The Kospi closed above the 2,800 mark for the first time in over 10 months.

According to the Korea Exchange, the Kospi rose 1.49 percent to close at 2,812.05, while the Kosdaq added 0.8 percent to end at 756.23. It was the first time the Kospi closed above 2,800 since July 18 last year, when it finished at 2,824.35.

Foreign investors, who net purchased over 1 trillion won ($735.8 million) in Kospi shares the previous day, continued buying with 911.9 billion won in net purchases. Institutional investors followed suit, recording 282.6 billion won in net buying. Retail investors, however, sold off 1.1831 trillion won worth of shares, locking in profits. On the Kosdaq, foreigners and institutions bought a net 38.7 billion won and 9 billion won, respectively, while individuals offloaded 42.4 billion won.

Shares of Samsung Electronics, the largest by market capitalization, briefly reached 59,900 won during intraday trading, fueling hopes for a return to the “60,000 won Samsung” level. It ended the session at 59,100 won, up 2.25 percent, after profit-taking increased late in the session. SK hynix closed 3.22 percent higher at 224,500 won.

Korea Hydro & Nuclear Power affiliates rose sharply following a final contract announcement for a Czech nuclear project: Korea Engineering Consultants Corporation surged 19.8 percent, Korea Electric Power Industrial Development 11.84 percent and Doosan Enerbility 7.62 percent. Defense-related stocks, including Hanwha Aerospace, which gained 7.1 percent, and Korea Aerospace Industries, up 2.29 percent, also advanced. Other large caps such as Samsung Life Insurance and Kia posted strong gains, up 10.75 percent and 3.91 percent, respectively.

President Lee Jae-myung speaks at a meeting held in central Seoul on June 5. [YONHAP]

The closing figures of the Kospi and Kosdaq are displayed on a screen in Hana Bank in central Seoul on June 5. [NEWS1]

Amid expectations for market revitalization, the total net asset value of exchange-traded funds (ETFs) listed in Korea surpassed 200 trillion won for the first time. As of Tuesday’s close, the figure stood at 201.28 trillion won, according to the Korea Exchange and Korea Securities Depository. It marks a milestone 23 years after ETFs were first introduced in the country in 2002.

ETFs are considered a convenient and cost-effective investment vehicle that tracks market indexes with lower management fees than mutual funds. Their passive nature makes them more stable than individual stocks. Their accessibility has fueled rapid growth in demand, with 984 ETFs currently listed in Korea. During his presidential campaign, President Lee Jae-myung had pledged to usher in the “Kospi 5000 era” and publicly disclosed his investment in ETFs tracking the Kospi 200 and Kosdaq 150 indexes.

“Indices have climbed on continued foreign buying of large-cap stocks in the semiconductor, automotive and battery sectors, which had been overlooked until recently," said analyst Lee Jae-won at Shinhan Securities. "In addition, the ruling party’s pledge to immediately implement amendments to the Commercial Act led to all-time highs for several holding companies. But since the Kospi had entered an overbought zone in the short term, corrective measures may follow."

The won strengthened against the U.S. dollar, ending Thursday’s session at 1,358.4 won per dollar, up 11.1 won from the previous close.

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.
BY KO SUK-HYUN [[email protected]]