South Korea's stock market breaks 9,000 points for first time; KOSPI closes up 2.25%

South Korean stocks surged over 2% on Thursday, breaching the 9,000-point mark for the first time in history. Investors bet on chipmakers as the Fed took a hawkish stance and the Iran situation remained uncertain.

The Korea Composite Stock Price Index (KOSPI) closed up 199.6 points, or 2.25%, at 9,063.84, after hitting an intraday high of 9,106.07.

Boosted by optimism over artificial intelligence (AI) and related industries, the index rose for the sixth consecutive trading day.

Trading volume was heavy at 505.9 million shares worth 49.9 trillion won (approximately $32.7 billion). Foreign investors net bought 1.3 trillion won, while retail and institutional investors net sold a combined 1.2 trillion won.

The index reversed the overnight decline on Wall Street after Fed policymakers signaled that rate hikes are necessary to curb inflation.

Kim Seok-hwan, an analyst at Mirae Asset Securities in South Korea, said the rise in shares of the country's top two chipmakers, Samsung Electronics and SK hynix, was the main driver behind the KOSPI's continued rally.

"Investors expect semiconductor companies may gain greater pricing power due to ongoing supply bottlenecks," the analyst said.

Risk appetite also revived on expectations that the U.S.-Iran war may soon end. The Fed's decision to hold rates steady for the fourth consecutive time appeared to have limited impact on investor sentiment.