South Korea’s KOSPI rose 3.56% Thursday, Aug. 13, closing above 6,800 for the first time and extending its gains to a fourth session as Samsung Electronics and SK Hynix led a broad rebound in technology shares.
Foreign investors were net buyers of South Korean stocks, helping the index overcome more than a 20% pullback from July’s lows and move into technical bull-market mode.
The advance came on the heels of the steepest drop in South Korea’s semiconductor stocks in July, which added to worries about the viability of the AI investment cycle. The recent recovery instead has been bolstered by a return in appetite for chip stocks, closer sentiment towards AI infrastructure investments and by foreign investors.
Samsung, SK Hynix Drive KOSPI Recovery
Samsung Electronics and SK Hynix were among the strongest performers in Seoul on Thursday, extending gains from the previous session. Their movements have an outsized influence on the KOSPI because of their large market capitalizations and importance to South Korea’s semiconductor industry.
The latest rally follows gains in U.S. technology stocks and stronger sentiment toward companies supplying infrastructure for artificial intelligence. The broader global semiconductor sector has been sensitive to expectations for spending by cloud providers and other large technology companies, making Korean memory-chip producers a key focus for investors.
Foreign investors bought about 2 trillion won ($1.4 billion) of KOSPI shares Thursday, according to Korea Exchange data cited by Seoul Economic Daily. The buying marked another session of overseas inflows as investors returned to Korean equities after the July sell-off.
AI Memory Demand Remains Key Driver
The recovery has renewed attention on the role of high-bandwidth memory, or HBM, in the AI infrastructure market.
As the demand for memory that goes with cutting-edge processors at AI data centers continues to rise, Samsung has been increasing its HBM business as well. In February, the company announced it had started mass production of HBM4, and forecast that its HBM sales would exceed three times in 2026 from 2025.
Samsung was also set to increase the volume of its HBM4 production. In July, Samsung and Broadcom announced a strategic alliance for memory, foundry and advanced packaging technologies for next-generation AI infrastructure.
The planned co-operation may reach $200 billion across memory and foundry operations by 2030, but may not be a realised transaction, as it is an estimated value of co-operation.
The profitability outlook for the second quarter was also much more favorable than a year ago in Samsung’s earnings guidance.
The company’s second quarter sales are estimated at approximately 171 trillion won and operating profit of approximately 89.4 trillion won, up from approximately 74.57 trillion won in sales and approximately 4.68 trillion won in operating profit in the second quarter of 2025.
SK Hynix has similarly positioned HBM as a central part of its semiconductor business as AI-related demand expands. The company’s investor-relations materials identify DRAM, NAND and AI-related memory products among its core businesses.
July Sell-Off Set the Stage for Rebound
The current rally follows a period of extreme volatility in South Korean technology stocks.
The KOSPI suffered a steep decline in July as investors reassessed valuations and the outlook for AI-related semiconductor demand. Samsung Electronics and SK Hynix also came under heavy selling pressure, amplifying the decline in the broader index.
The subsequent rebound has been helped by a combination of renewed buying and a recovery in semiconductor sentiment. Thursday’s gain brought the KOSPI more than 20% above its July low, meeting the commonly used threshold for a technical bull market.
The scale of the recovery also highlights the sensitivity of South Korea’s equity market to its major semiconductor companies. When investors increase or reduce exposure to Samsung and SK Hynix, the effect can quickly spread to the broader index.
Investors Still Face AI Spending Risks
Despite the rebound, the outlook remains closely tied to the pace of AI investment.
The memory-chip industry has enjoyed demand due to AI servers and high-tech computing, but stocks have been volatile about the capital spending outlook of big tech companies. A dip in investment in infrastructure, lower memory prices or a shift in expectations for memory demand could create another opportunity to press semiconductor stocks downward.
The market is also wondering if the modest rally is the result of a fundamental turnaround by companies or some of the unwinding of positions taken up during the July pullback.
For now, foreign buying and renewed confidence in AI-related chip demand have helped Samsung Electronics and SK Hynix lead the KOSPI higher. Investors will continue to watch memory prices, AI infrastructure spending and overseas fund flows for signs of whether the recovery can extend beyond the initial rebound.
