The KOSPI climbed to just below 7,000 as optimism spread over OpenAI's next-generation artificial intelligence model, Astra, driving a rare surge in large-cap chip stocks including Samsung Electronics and SK hynix. Goldman Sachs maintained its 12,000-point target for the index, saying the memory chip boom will last longer than the market expects.
The KOSPI closed at 6,995.39 on the 7th, up 308.18 points, or 4.61%, from the previous session, according to the Korea Exchange. That is the highest level since it closed at 7,096.89 on July 23.
Large-cap chip stocks led the advance. Expectations that the spread of high-performance AI models will lift demand for high-capacity memory and keep memory prices rising improved sentiment across the sector. Samsung Electronics ended 5.68% higher at 270,000 won, while SK hynix jumped 8.26% to 1.783 million won. Gains of that size were the first in about three weeks.
The strength in large chip names spread to materials, components and equipment makers. Doosan Tesna surged 11.31% and Psk Holdings rose 8.33%. Eugene Technology gained 4.91%, Soulbrain 4.77%, Tes 4.02% and Wonik IPS 2.44%.
"Macro conditions such as oil prices and interest rates are weighing on the market, but corporate news offset that pressure," said Lee Kyoung-min, an analyst at Daishin Securities. "OpenAI's unveiling of Astra and Nvidia's acquisition of Hugging Face broadened expectations for memory demand."
Foreign investors bought a net 2.5525 trillion won and institutions a net 2.6398 trillion won. Retail investors sold a net 6.8274 trillion won, the second-largest amount on record after the 8.284 trillion won recorded on July 31. Individual investors appear to have grown weary after the KOSPI drifted for months following its retreat from its peak. With the index surging more than 4% in a single session and approaching 7,000, investors who had been sitting on losses moved to break even while others took profits, all at once. Investor deposits at brokerages stood at 93.5499 trillion won as of the 4th, down from the previous day and the lowest in eight months since 91.2181 trillion won on Jan. 16.
Goldman Sachs sees room for further gains. Timothy Moe, chief Asia-Pacific equity strategist at Goldman Sachs, said in an interview that the market is underestimating how long the current earnings cycle will last, and kept his 12,000-point target for the KOSPI, Bloomberg reported.
The bank's optimism rests on sharply improving corporate earnings and low valuations. Goldman expects net profit at KOSPI-listed companies to grow 360% this year, and its 12,000-point target applies a forward price-to-earnings ratio of 7.5 times. With the index currently trading at about 5.3 times, the bank judges there is ample upside if companies meet their earnings forecasts.
