South Korean stocks closed nearly 1% higher on Wednesday, supported by share buybacks from domestic chip heavyweights and a calmer external environment, while investors awaited earnings results from Nvidia. The Korean won weakened against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) advanced 65.47 points, or 0.97%, to close at 6,808.21. The index traded with volatility during the morning session before climbing as institutional investors turned net buyers, purchasing a net 760.37 billion won. Foreign and retail investors were net sellers, offloading a combined 2.36 trillion won.

"The KOSPI has recovered above the 6,800-point level, helped by share repurchases, while falling global oil prices and declining U.S. Treasury yields have helped boost investor sentiment," said Lee Kyoung-min, an analyst at Daishin Securities.

Chip giant SK Hynix has been conducting a buyback of approximately 650,000 shares since last Thursday, with Samsung Electronics joining the move this week. Investors are also closely monitoring Nvidia's upcoming earnings release, which will serve as a key barometer for the global artificial intelligence (AI) infrastructure market.

Large-cap Samsung Electronics rose 1.75% to close at 261,500 won, while its industry rival SK Hynix edged up 0.6% to 1,688,000 won. Industry leader Hyundai Motor fell 3.09% to close at 408,000 won, and defense giant Hanwha Aerospace slipped 1.36% to 1,087,000 won. Major financial firm KB Financial inched up 0.12% to close at 166,600 won.

Nuclear energy-related stocks advanced following reports that the U.S. government proposed South Korea jointly acquire shares in Westinghouse Electric Company, a nuclear power business owned by a Canadian private equity firm. The Korean won stood at 1,384.8 won against the U.S. dollar as of 3:30 p.m. local time, up 1.3 won from the previous session.