Kospi Seeks Chuseok Bounce Amid US-China Tensions, Oil Price Volatility

The Kospi rebounded late in the week after a decline earlier in the week due to rising oil prices, higher US long-term yields, and concerns over AI development. The index closed at 6,894.23 on Friday, up 2.66% from the previous session, but down 0.23% for the week.

The rebound was led by Samsung Electronics and SK hynix, as analysts noted that major central bank policy events had helped clear one hurdle of macroeconomic uncertainty. The Federal Reserve raised its benchmark interest rate by 25 basis points at its September meeting, but the updated dot plot pointed to a higher year-end rate forecast.

The US-China summit on Thursday is expected to discuss AI, trade, and rare earths, among other issues, with negotiations on AI seen as particularly consequential for domestic markets. Analysts noted that tighter US restrictions on semiconductor exports to China would constrain Beijing's ability to develop low-cost AI, potentially creating a windfall for South Korean chipmakers.