South Korea’s benchmark Kospi index logged its strongest monthly gain, up nearly 31%, since January 1998, powered by a surge in tech stocks that has helped the market shrug off geopolitical tensions in the Middle East.
The index’s outsized gains have been driven largely by optimism around the artificial intelligence boom, with semiconductor giants and heavyweights SK Hynix and Samsung Electronics leading the charge, up 60% and 35%, respectively on month.
HSBC last week upgraded South Korea to “neutral” from “underweight,” saying recent foreign outflows had helped unwind crowded positioning in the market and reduced downside risks from geopolitical volatility.
Beyond the heavyweight chipmakers, HSBC said broader growth themes in areas such as energy storage, shipbuilding, defense and nuclear power are also supporting the market’s rally.
The milestone rally comes as the broader Asia-Pacific markets, including the Kospi, declined Thursday, pressured by a spike in oil prices that hit four-year highs, before paring gains, on fears of potential U.S. military action against Iran and lingering uncertainty after the Federal Reserve held rates steady.
South Korea’s Kospi lost 92.03 points or 1.4%, to 6,598.87
Oil climbed after Axios reported that the U.S. Central Command was set to present U.S. President Donald Trump plans for possible military action against Iran.
Trump had earlier reportedly rejected Tehran’s proposal to reopen the Strait of Hormuz, signaling the naval blockade will remain in place until a broader nuclear agreement is reached.
In Japan, the Nikkei 225 returned to trading Thursday after a day off, and dumped 632.54 points, or 1.1%, to 59,284.92.
In Hong Kong, the Hang Seng shed 335.31 points, or 1.3%, to 25,776.53.
In other markets
The CSI 300 index in Shanghai dipped 3.04 points, or 0.1%, to 4,807.31.
In Taiwan, the Taiex sank 376.87 or 1%, to 38,926.63
In Singapore, the Straits Times Index went against the trend and gained 51.72 points, or 1.1%, to 4,912.69
In New Zealand, the NZX 50 gained 133.01 points, or 1%, to 12,903.31.
In Australia, the AZX 200 fell 21.17 points, or 0.2%, to 8,665.82.
