The KOSPI perfect storm: leverage, memory and the battle for AI in the Korean market
The more than 30% correction on the Seoul Stock Exchange reveals the fragility of an index in which Samsung Electronics and SK Hynix are worth more than everything else combined.
South Korea's KOSPI stock index has experienced significant volatility in 2026, reaching record highs before plummeting by over 30%. This downturn is attributed to a combination of factors, including excessive retail leverage, a heavy concentration in tech giants Samsung Electronics and SK Hynix, and uncertainty surrounding AI demand.
To curb speculative investment, Korean regulators increased the minimum deposit for leveraged products and raised margin requirements. The KOSPI's sensitivity to these movements is partly due to Samsung Electronics and SK Hynix representing around 53% of the index, with their future in the AI memory market, including HBM, uncertain. Despite this, both companies have committed to returning capital to shareholders.
Written by urgent.news from El Pais Economia's report — not a translation of it. Machine-written — may contain errors; check the original before relying on it.
