South Korea’s benchmark stock index rebounded sharply on Friday, with the KOSPI advancing 16.5% to 6,513.45 points by 01:10 GMT, effectively clawing back most of this week’s dramatic losses. Earlier in the week the index had tumbled to as low as 5,262.77 points.
The benchmark had plunged nearly 17% across the prior three trading sessions, marking one of its worst weekly selloffs in recent memory. The rout was concentrated in semiconductor stocks after investors raised concerns about intensifying competition from Chinese memory-chip manufacturers, prompting heavy selling across the sector.
Thursday’s strong rebound on Wall Street spilled into Asian markets and proved pivotal for the KOSPI. Technology shares led U.S. gains after Microsoft reported results that exceeded expectations, reigniting confidence in artificial intelligence-related spending and demand for cloud services. Microsoft’s earnings, highlighted by robust Azure cloud growth, helped ease investor worries that heavy investment in AI infrastructure might not produce adequate returns.
That rebound translated into large moves in South Korea’s chip leaders. Samsung Electronics rallied by more than 21%, while SK Hynix climbed in excess of 26% as both names recovered from earlier heavy losses. The two companies had each released quarterly results this week: Samsung posted a record quarterly profit, led by its semiconductor division, and said it expects a favorable supply-demand dynamic for memory chips through at least 2027, citing expanding long-term customer contracts. SK Hynix registered record revenue for the quarter, although its profit fell short of market expectations.
Despite those solid earnings reports, both stocks were hit hard earlier in the week as investors engaged in profit-taking following a substantial AI-driven rally. Questions over whether current valuations fully reflect future earnings growth, combined with concerns around AI infrastructure spending and competition from Chinese memory-chip makers, had contributed to the earlier selloff.
Market takeaway
- The KOSPI’s 16.5% jump brought the index back to 6,513.45 points by 01:10 GMT after a low of 5,262.77 earlier in the week.
- Wall Street’s tech-led recovery, powered by stronger-than-expected Microsoft results and Azure growth, was a key catalyst for the Asian rebound.
- Samsung and SK Hynix led the rally in Seoul, with Samsung up over 21% and SK Hynix rising more than 26%, following their respective quarterly reports.
Context and investor behavior
Investor reactions this week combined profit-taking after a prior AI-fueled advance with renewed optimism following clearer signs of cloud and AI demand from corporate results. The interaction between earnings-driven sentiment in the U.S. and sector-specific worries about competition in memory chips shaped the sharp moves in South Korean equities.