South Korean shares rose more than 1per cent on Thursday and extended gains to a third straight session as strong foreign buying powered local chip stocks. Both the won and the benchmark bond yield weakened.
The benchmark KOSPI closed up 31.53 points, or 1.33 per cent, at 2,395.90.
Chip giant Samsung Electronics Co Ltd ended 3.7 per cent higher, tracking a surge in the Philadelphia Semiconductor index, after Nvidia Corp's announcement on its new gaming chips in collaboration with Micron Technology Inc and Samsung.
Samsung's peer SK Hynix Inc and the subindex for electric and electronics stocks jumped 4.2 per cent and 3.2 per cent, respectively.
Further boosting sentiment, South Korea's government announced a plan to create a 20 trillion won ($16.84 billion) fund over the next five years for President Moon Jae-in's "New Deal" program.
"Strong gains in local semiconductor shares towed KOSPI, especially with active foreign buying of Samsung Electronics shares," said Lee Young-gon, Hana Financial Investment analyst.
The "New Deal" fund and fewer daily coronavirus infections also lifted sentiment, Lee added.
Foreigners were net buyers of 194.0 billion won worth of shares on the main board.
The won was quoted at 1,188.3 per dollar on the onshore settlement platform, 0.24 per cent lower than its previous close at 1,185.4.
In offshore trading, the won was quoted at 1,188.5 per dollar, up 0.1 per cent from the previous day, while in non-deliverable forward trading its one-month contract was quoted at 1,188.5.
In money and debt markets, September futures on three-year treasury bonds fell 0.01 points to 111.84.
The most-liquid three-year Korean treasury bond yield fell by 0.5 basis points to 0.920 per cent, while the benchmark 10-year yield fell by 1.4 basis points to 1.525 per cent.