Overview
- The KOSPI surged roughly 68% in Q2 on heavy buying of memory and AI-related chipmakers, with Samsung Electronics and SK Hynix now making up an unusually large share of the index.
- South Korea’s trade data for June showed record exports and semiconductor shipments that pushed monthly exports above $100 billion, supporting the earnings backdrop for chip firms.
- Regulators activated circuit breakers, delayed options and warned about single-stock leveraged ETFs after extreme swings, and senior officials publicly lamented permitting leveraged products that amplified volatility.
- High retail margin borrowing and booming single-stock leveraged funds have raised the risk of margin calls and forced selling if hyperscalers cut capital spending or company guidance weakens.
- Market gains have extended beyond Korea to major global chip names that added trillions in market value in Q2, but the rally now depends on hyperscaler capex, quarterly guidance and whether order books hold into 2027.