KOSPI Surges 3.3% as Samsung and SK Hynix Rally, Rebounding From Six-Month Low on Foreign Buying Return

SEOUL, South Korea — South Korean stocks rebounded sharply on Wednesday, recovering from a six-month low as chipmakers Samsung Electronics and SK Hynix rallied and foreign investors returned to the market.

The benchmark Korea Composite Stock Price Index, or KOSPI, closed up 182.93 points, or 3.29%, at 5,735.67. The gain erased much of Tuesday's 3.73% plunge, which had pushed the index to its lowest level in six months.

Chipmakers lead the recovery

Samsung Electronics, the country's largest company, rose 5.67%, while SK Hynix gained 5.8%. Both stocks had been hammered in recent weeks amid concerns about spending on artificial intelligence and rising global bond yields.

The two chipmakers carry an outsized influence on the KOSPI. Together, they accounted for about 44% of the index's value earlier this year, meaning their moves can drive the broader market.

The rally extended across much of the market. The smaller KOSDAQ index also gained in early trading, rising about 2.6%.

Foreign investors return

The rebound came as foreign investors, who had been heavy sellers of South Korean stocks in recent weeks, resumed buying. In early trading, foreign investors purchased a net 447.1 billion won of KOSPI shares, while institutional investors bought 137.7 billion won, according to market data.

That marked a sharp shift. Between Oct. 1 and Oct. 20, foreign investors sold a net 18.1 trillion won of South Korean shares, including about 4.1 trillion won of Samsung Electronics and nearly 10 trillion won of SK Hynix.

What drove the rally

Several factors supported the rebound. Strong earnings from major U.S. technology companies lifted sentiment toward chip stocks, after a broad rally on Wall Street overnight.

The yield on the 10-year U.S. Treasury note eased slightly to around 5.12%, offering some relief after higher borrowing costs weighed on technology stocks. A stronger South Korean won also encouraged foreign buying.

Bargain hunting played a role as well, as investors moved back into stocks that had fallen sharply in recent weeks.

Shares of AI company Elice, whose 32% plunge in its trading debut on Tuesday rattled markets, rebounded Wednesday, rising by the daily upper limit of 29.9%.

A volatile stretch

The KOSPI has swung sharply in recent weeks. The index had surged to record highs earlier this year on soaring demand for memory chips used in artificial intelligence, but it has fallen significantly since its June peak.

Last week, Samsung and SK Hynix suffered their worst weekly losses since the 2008 global financial crisis, falling 17.8% and 24.3%, respectively, as investors questioned the sustainability of AI spending and worried about competition and higher interest rates.

Despite the recent losses, the KOSPI remains up about 30% so far this year.

Buybacks and earnings ahead

Market watchers are monitoring the end of share buyback programs by both chipmakers. SK Hynix had repurchased about 22.75 million shares under a 40 trillion won program launched in August, with the buyback expected to conclude around Wednesday. The end of buyback support could affect the stocks' momentum.

Earnings will be key. SK Hynix is scheduled to report third-quarter results on Oct. 28, and Samsung Electronics on Oct. 29. Investors will be watching for updates on high-bandwidth memory demand, chip prices and customer commitments for 2027.

Short-term bottom or temporary bounce?

Analysts are divided on whether Tuesday's low marked a bottom. Strong earnings and continued foreign buying could signal that the worst of the sell-off is over, while weaker investment plans from technology companies or downward revisions to chip earnings forecasts could turn Wednesday's gains into a short-lived rebound.

What to watch

Investors will be watching foreign investor flows, U.S. Treasury yields, the performance of global technology stocks and the upcoming chipmaker earnings reports for clues about the market's direction.