South Korean stocks closed slightly higher on Monday, snapping a two-day losing streak as investors purchased stocks of key chipmakers following Wall Street's extended record-setting rally. The Dow Jones Industrial Average (DJIA) gained 0.3%, the broader S&P 500 added 0.6% to a new record, and the technology-laden Nasdaq Composite climbed 1.3%.

The Korea Composite Stock Price Index, or Kospi, increased by 40.89 points, or 0.7%, to close at 6,299.66. The Kosdaq also rose by 55.66 points, or 7%, to close at 854.47.

In economic news, electricity demand in South Korea breached the year's all-time high mark as a prolonged heat wave kept power consumption elevated, according to data from the Korea Power Exchange.

Maximum electricity demand reached 95.321 gigawatts on Aug. 8, while reserve capacity stood at 8.2 gigawatts. The available power supply was raised by 2 gigawatts from last year to 107 gigawatts.

In corporate news, shares of Ilsung Construction (KRX:013360) added nearly 5% at market close after it secured a construction contract for the new main building at Eulji University Daejeon campus, according to a Monday filing with the Korean Exchange.

The contract, valued at 32.65 billion won, is valid till Jan. 9, 2029. Under the contract, the company will construct a 3,537-pyeong new main building, renovate two buildings totaling 3,448 pyeong, and demolish 5,971 pyeong of existing facilities.