Korean shares gained on Tuesday with the benchmark Kospi briefly recovering to the 2500-point level to reverse sharp losses induced by political turmoil late last year as foreign investors maintained their net buying spree.

According to the Korea Exchange, foreigners net purchased 419.9 billion won ($390 million) on Kospi in four trading days this year, continuing their net buying streak for three consecutive days after a massive sell-off in December.

Buoyed by foreigners’ return to Korean shares, the Kospi rebounded to the 2,520 points level at some point -- one unseen for three weeks after the country was engulfed in political turbulence following the failed martial law attempt by President Yoon Suk Yeol on Dec. 3.

The Kospi closed at 2,492.10 points, climbing 0.14 percent while while the Kosdaq inched up by 0.05 percent to 718.29.

Foreigners scooped up 157.8 billion won's worth of stocks listed on the main board, institutions and retail investors sold 42.9 billion won and 203.3 billion won's worth of shares, respectively.

The rebound gives some breathing room to the Korean stock market, which was one of the worst performers around the globe last year.

In 2024, the Kospi shed 9.63 percent while the secondary Kosdaq dived a whopping 21.74 percent, ranking 38th and 43rd among 43 indices worldwide, according to financial information provider Investing.com.

Semiconductor stocks, strong drivers that pushed the whole market higher in a couple of days, were mixed as some investors switched to sell position to lock in profits after sharp rises in previous days, thanks to the CES 2025 trade show in Las Vegas that unleashed investors’ appetite for artificial intelligence technology.

“The fact that AI momentum is effective will limit downward pressure on tech shares,” said Han Ji-young, a strategist at Kiwoom Securities.

SK hynix, the world's second-largest memory chip maker touched 206,500 won during early morning trading, hitting the highest in two months since Nov. 8.

However, SK hynix and Samsung Electronics retreated from their early advance in the afternoon over disappointment as the two companies were left out of Nvidia CEO Jensen Huang’s opening keynote speech at CES.

He unveiled the company’s new chips for desktop and laptop PCs, called GeForce RTX 50-series, which features 92 billion transistors and G7 memory from US-based Micron Technology.

Shares of Hanmi Semiconductor, which supplies thermal compression bonders used in the production of high-bandwidth memory to SK hynix and Micron Technology, rose 1.81 percent, moving higher in four straight sessions.

Shares in shipbuilding, defense and biopharmaceutical industries offset losses by chip stocks during the afternoon trading. Samsung Biologics, HJ Shipbuilding & Construction and Hanwha Systems jumped 3.91 percent, 15.97 percent and 4.88 percent.

The Korean shares also rose in tandem with the US Supply Management Association's Manufacturing Purchasing Managers' Index as the indicator measuring the level of business activities in the US manufacturing sector showed signs of recovery in December.

Investors receive such improvements in the US indicator as a tailwind to the exports of Korea’s rechargeable batteries, automobiles and information technology stocks.

“Since the US manufacturing index has a high correlation with the export sentiment, expectations for a turnaround of the Kospi are rising along with last month's solid export performance in Korea,” said Lee Kyung-min, a researcher at Daishin Securities.

By Park Han-na (hnpark@heraldcorp.com)