Trading on South Korea's main bourse turned sharply positive on Friday as the Kospi index rose 18% in a single session, marking its largest one-day increase on record. Semiconductor makers led the advance: SK Hynix climbed about 30% and Samsung Electronics jumped roughly 28%.
Earnings and investor sentiment
The turnaround followed stronger-than-expected quarterly reports from Microsoft and Amazon. Both companies reiterated large ongoing investments in artificial intelligence and data-center capacity, which investors interpreted as a sign of sustained demand for chips and related infrastructure—supporting renewed confidence in the semiconductor sector.
Technical drivers and earlier sell-off
Earlier in the week the Korean market had suffered sizable declines amid worries that tech giants were overspending on AI and facing tougher competition from Chinese peers. That sell-off was amplified by forced liquidations of leveraged positions, a technical dynamic that magnified price moves. Market participants now view the prior wave of selling largely as driven by technical and profit-taking factors rather than a deterioration in AI sector fundamentals.
Government measures and state support
Local policy steps also helped the rally. The South Korean government announced it would allocate nearly $14 billion to the state investment fund for AI-related investments and data-center development. Regulators additionally signaled measures to restrict retail access to certain leveraged ETFs, citing those products as contributors to the earlier panic selling.
Insider purchase and market signals
SK Hynix received an extra boost when Chey Tae-won, chairman of SK Group, purchased SK Hynix shares in his own name, a buy valued at about $3 million that the market read as a strong vote of confidence. These developments helped reverse much of the week’s earlier decline within hours and propelled significant gains among already volatile tech stocks.
Why it matters
The episode illustrates how corporate guidance on AI spending and targeted government backing can rapidly reshape investor sentiment—especially in markets where large players and leveraged positions can drive outsized short-term moves. At the same time, the extreme one-day swing underscores persistent volatility and the role of technical factors authorities are now trying to address.
This article does not constitute investment advice or a recommendation.
