Japan and South Korea Stocks Fall After Rally: KOSPI Edges Up, Nikkei 225 Turns Lower, Samsung, Kioxia and SK Hynix Erase Gains

TradingKey - Japanese and South Korean stocks pared early gains, with the KOSPI closing slightly higher and the Nikkei 225 turning from gains to losses, while Kioxia, SK Hynix, and Samsung all gave back significant gains.

During the Asian trading session on July 22, both Japanese and South Korean stock markets experienced an explosive open and rallied early in the morning, but continued to edge lower in the afternoon, with both markets paring gains from their highs. Among them, the KOSPI Index surged 6% this morning before its gains eventually narrowed to 0.74%, falling below the 70,000 mark again to temporarily stand at 6,797.70 points; heavyweight stocks also gave back a significant portion of their morning gains, with Samsung Electronics rising 0.68% to close at 261,000 won (about $176.58), while SK Hynix closed flat at yesterday's closing price of 1,836,000 won.

KOSPI Index Chart, Source: TradingView

The Nikkei 225 Index eventually gave back all of its morning gains to close slightly down by 0.18% at 66,115.55 points, forming a consolidation daily candlestick with a long upper shadow; Kioxia closed up 5.26% at 64,270 yen (about $394.04); SoftBank turned from gains to losses, dropping 0.83% to close at 5,703 yen.

The 'open high, close low' pattern of Japanese and South Korean stock markets reflects that while the market's medium-to-long-term confidence in the semiconductor supercycle remains solid, short-term anxiety persists. Moving forward, investors should closely monitor the upcoming earnings reports of U.S. tech giants and their AI capital expenditure guidance to assess the sustainability of momentum in the AI supply chain. Tonight, Alphabet ( GOOG) and Tesla ( TSLA) will release their earnings reports after the U.S. market close.