South Korean stocks jumped on Wednesday, supported by a return of investors to AI stocks, ahead of earnings releases from major US technology and chip companies, following a sharp sell-off last week that wiped billions of dollars off the sector's market value.

The main KOSPI index rose 316.67 points, or 4.69 percent, to 7,064.62 points by 03:41 GMT, after earlier in the session posting gains of 6.2 percent. The KOSDAQ index for small-cap stocks also rose about 5 percent.

The KOSPI exchange activated the temporary trading suspension mechanism known as the 'sidecar', which is triggered when the index moves up or down by 5 percent, for the 11th time in 15 trading sessions this month.

This reflects the continued high volatility in the market, which is dominated by shares of Samsung Electronics and SK Hynix, the two global leaders in the AI chip race.

The Korean market's gains followed a strong session on Wall Street overnight, with the Nasdaq rising slightly while the Philadelphia Semiconductor Index jumped more than 5 percent, its best performance in five weeks.

Investors are awaiting earnings results from Alphabet, Intel, and Texas Instruments for clues on the performance of the AI and semiconductor sectors.

Jason Lui, head of equity derivatives strategy for Asia-Pacific at BNP Paribas, said: 'After the sharp pullback in stock prices, which was largely valuation-driven, investor positioning ahead of big tech earnings is less crowded.'

He added that this would allow investors to 'better assess companies' growth prospects based on their fundamentals'.

On the KOSPI, shares of SK Hynix, the world's largest producer of memory chips for AI, jumped more than 9 percent, while Samsung Electronics rose 6.6 percent, extending gains from the previous session.

Separately, William Bratton, head of cash equity research for Asia-Pacific at BNP Paribas, said: 'Without these two companies, there wouldn't be much to get excited about in the South Korean stock market, at least from a long-term earnings growth perspective.'

He added: 'The two most exciting companies in South Korea are also among the most volatile, creating risks for long-term buy-and-hold investors.'

Among other stocks, Hyundai Motor rose as much as 7.14 percent, Kia climbed 3.11 percent, and LG Energy Solution, a battery maker, gained 3.8 percent.

Of the 915 stocks traded, 692 rose while 194 fell. Foreign investors recorded net purchases of 2.01 trillion won (about $1.36 billion), bringing their net purchases over the past week through Tuesday to 2.71 trillion won.

In the currency market, the won was trading at 1,483 against the U.S. dollar, after hitting its highest level since mid-May at 1,471 per dollar in the previous session.