Round-up of South Korean financial markets:
** South Korean shares recouped early losses to settle higher on Tuesday as foreigners returned after a bruising selloff the previous day, while the won strengthened to a two-month high as major firms sold dollars.
** The benchmark KOSPI closed up 49.90 points, or 0.73 percent, at 6,856.83 points. It fell as much as 5.3 percent earlier in the session to its lowest point since April 24. The benchmark has shed about 25 percent from its record closing high in late June, confirming a bear market.
** The won appreciated to as much as 1,486.3 per US dollar, its highest level since mid-May, as major chipmakers and shipbuilders sold large amount of dollars in the forward market, according to the finance ministry.** "There are dollar-selling orders from SK Hynix," an official at a local bank said, adding that there was dollar-selling during the session as well. ** "Given the supply factor, we are leaving room for dollar-won rates to fall to at least the 1,480 level," a local currency trader said.
** The won, last quoted at 1,493 a dollar on the onshore settlement platform, as of 0653 GMT, has firmed around 4 percent against the US dollar so far in July. The onshore spot dollar-won started trading 24 hours early last week, as part of South Korea's efforts to broaden currency convertibility.
** Shares of SK Hynix ended 3.7 percent higher after falling as much as 9 percent, underscoring the extreme volatility in the AI memory chipmaker. The recovery followed an over 9 percent plunge in its US-listed sharesSKHY.O overnight.
** "Foreign investors seem to be buying, suggesting they thought the steep decline was overdone. Unwinding of leveraged ETFs could be triggering an overshoot," said Duncan Wrigley, Chief China+ Economist, Pantheon Macroeconomics.
** Wrigley also attributed the bounce in KOSPI to the finance ministry hiking its 2026 growth forecast to a five-year high of 3.0 percent, fuelled by a global semiconductor boom.
** Meanwhile, members of South Korea's ruling party are seeking to amend a law to make it easier for SK Hynix to form ventures with outside investors to build factories, supporting the government's drive to establish the country as an AI powerhouse.
** Shares of chipmaker Samsung Electronics rose 3.3 percent, while battery manufacturer LG Energy Solution slid 2 percent.
** Hyundai Motor and sister automaker Kia Corp slipped 4.4 percent and 2.7 percent, respectively.
** Separately, the Bank of Korea is expected to raise interest rates on Thursday for the first time in more than three years and deliver another increase by the end of the year, according to a Reuters poll of economists.
** Of the total 912 traded issues, 219 shares advanced, while 662 declined. Foreigners were net buyers of shares worth 952.3 billion won (US$637.44 million).
Reuters
