KOSPI Doubles to Record 8,457 as Chip ETFs Surge

South Korea’s KOSPI rose 4.56% to a record 8,457 on Wednesday, officially doubling year-to-date. Samsung Electronics gained 6.5% and SK Hynix rose 9.5%, pushing the benchmark higher. The session added about $220 billion in market value and roughly $900 billion over May. The market’s total capitalization is roughly $4.5 trillion; the two chipmakers account for about 42% of the index and nearly half of that value.

Analysts point to strong demand for AI-focused memory chips as a driver of semiconductor gains. JPMorgan raised its KOSPI target to 9,000 and outlined a bull case of 10,000.

Domestic retail investors moved large sums into leveraged chip funds. A 2x SK Hynix leveraged ETF listed in Hong Kong has taken in about $1.3 billion year-to-date and expanded to roughly $8 billion in assets over three months; a 2x Samsung ETF has shown similar inflows. These funds now exceed comparable leveraged products tied to major U.S. technology stocks and are a major channel for concentrated exposure to Korea’s chip sector.

Cryptocurrency activity on Korean exchanges moved in the opposite direction. Trading volumes on local platforms fell about 80% as liquidity in won rotated toward equities. Upbit and Bithumb together account for about 96% of domestic crypto volume. The local kimchi premium for Bitcoin stood near negative 2.19%, indicating lower Bitcoin prices in Korea versus international venues.

On May 15 the KOSPI briefly breached 8,000 before sliding 8.4% in a single session, erasing roughly $370 billion in market value. That reversal coincided with a short-lived rise in crypto trading on local exchanges.

Policy developments related to digital assets are advancing. President Lee Jae-myung has expressed support for a won-pegged stablecoin and for a Bitcoin spot ETF. A consortium of eight banks led by Kookmin, Shinhan and Woori is preparing a regulated KRW stablecoin under the Digital Asset Basic Act. Korean exchanges moved about $40 billion overseas in the first quarter, with stablecoins making up roughly half of that outflow. Supporters of a domestic won-backed token say it would help keep more liquidity onshore.

Market participants note the concentration of gains in a few large chipmakers and the rapid growth of leveraged ETFs as factors affecting where retail investors place capital. Korea has nearly 10 million crypto investors, more than 30% of the population.

A market commentator using the name Heisenberg wrote, “Everything memory related has gone straight vertical.”