^{Photo: Bloomberg.com}

South Korea’s benchmark Kospi index soared more than 3% on Thursday, climbing to an all-time high as investors piled into heavyweight tech stocks. The rally was led by Samsung Electronics and SK Hynix, which surged after announcing a major partnership with OpenAI to supply advanced memory chips critical for artificial intelligence applications.

Samsung and SK Hynix Lead the Rally

Samsung Electronics shares advanced more than 4.2%, while SK Hynix skyrocketed over 11% following the announcement. The collaboration with OpenAI is expected to boost demand for high-bandwidth memory (HBM) chips, which are essential for powering AI training and large language models.

The move positions both companies as key suppliers in the global AI ecosystem, joining other tech giants like Nvidia and TSMC, which are already capitalizing on the AI hardware boom. Analysts suggest that this deal could add billions in revenue over the next several years, with AI infrastructure spending projected to surpass $150 billion globally by 2027.

Kospi and Kosdaq Performance

The Kospi’s more than 3% surge brought it to an unprecedented peak, reflecting strong investor confidence in South Korea’s technology sector. Meanwhile, the Kosdaq index, which is home to smaller and growth-oriented companies, rose 0.95%, signaling broader market strength beyond the largest firms.

Inflation Data Adds to Market Sentiment

Adding to the positive momentum, South Korea’s consumer price index (CPI) rose 2.1% year-on-year in September, slightly above economist expectations of 2%. The increase marks an acceleration from August’s 1.7% growth, fueling speculation about the central bank’s next move. Although higher inflation may pressure household spending, investors appear more focused on the upside potential of South Korea’s tech-driven exports.

Regional Market Overview

• Japan: The Nikkei 225 advanced 0.6%, but the Topix index slipped 0.54%, reflecting mixed sentiment in Tokyo.
• Australia: The ASX/S&P 200 gained 1.14%, supported by strong mining and banking stocks.
• Hong Kong: The Hang Seng Index climbed 1.3%, led by a 12% surge in Zijin Gold shares, which extended their winning streak since debuting on the Hong Kong exchange earlier this week. The Hang Seng Tech Index also gained 2.08%.
• China & India: Both markets remained closed due to public holidays.

U.S. Markets Set the Tone

Overnight in the U.S., equity markets also showed strength, with the S&P 500 rising 0.34% to close at 6,711.20, hitting an intraday record before settling slightly lower. The Nasdaq Composite added 0.42% to reach 22,755.16, while the Dow Jones Industrial Average gained 43 points (0.09%) to finish at 46,441.10.

Investors, however, remain cautious about the ongoing U.S. government shutdown, which is now expected to last at least three days and potentially stretch up to two weeks. Despite this, traders appear confident that the economic impact will be limited in the short term.

Why This Matters

South Korea’s stock market rally highlights how artificial intelligence continues to reshape global financial markets. The surge in Samsung and SK Hynix underscores the critical role that chipmakers play in the AI supply chain. With demand for advanced semiconductors rising rapidly, South Korea is cementing its position as a global leader in high-tech exports, a sector that could drive the Kospi even higher in the months ahead.