Seoul stocks briefly top 6,700 on tech rally, ahead of M7 earnings

Seoul, April 28 (IANS) Seoul stocks briefly topped the 6,700-point level on Tuesday, set to reach another milestone, driven by large-cap tech shares ahead of earnings releases from big US tech companies.

The benchmark Korea Composite Stock Price Index (KOSPI) hit an intraday high of 6,712.73 points in the morning session, reports Yonhap news agency.

The new peak came ahead of first-quarter earnings releases from the Magnificent 7 (M7) companies in the United States, including Apple, Microsoft and Meta.

The benchmark index had risen by some 31 percent in the month of April, the second-largest monthly increase since February 1988.

The market’s record-breaking run came after the market experienced a severe rout since the outbreak of war in the Middle East.

Since the crisis started in late February, the KOSPI had once fallen by more than 12 percent in a single trading session, amid fears of the war’s impact on South Korea’s oil dependent economy.

It was one of the worst performing stock indexes globally, falling by over 19 percent for the month of March.

After surpassing the 5,000-point mark in late January, and topping another milestone of 6,000 points in February, the KOSPI erased most of its gains in March following the outbreak of the U.S.-Iran war.

But continued hope for the artificial intelligence (AI) boom pushed up major tech shares amid eased tension in the Middle East war.

More recently, Intel’s earnings surprise provided tailwinds to the local semiconductor sector, reaffirming market confidence in the AI sector, said Lee Kyoung-min, an analyst from Daishin Securities.

The U.S. chipmaker’s revenue for its data centre and AI business grew 22 percent on-year in the first quarter, outpacing market expectations.

But Han Ji-young, an analyst at Kiwoom Securities, said the market could experience some volatility ahead, noting that the VKOSPI, a “fear index” that measures market participants’ expectations for the volatility of the KOSPI200 over the next 30 days, is at a relatively high level of over 50 points.

“This implies that it may not be unusual for the KOSPI to show daily fluctuations of over 3 percent, as it continues to break records,” he said.

—IANS

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