The KOSPI index finally broke through the 7,000-point barrier on Thursday, closing at 7,081.21 after a 4.17% surge. The milestone came a day after the benchmark failed to hold that level, and was driven by a rebound in tech heavyweights Samsung Electronics and SK Hynix.
Tech Giants Lead the Charge
Samsung Electronics and SK Hynix, the two largest KOSPI constituents, extended their rebound from an earlier AI-driven selloff. The rally was further boosted by Alphabet's strong quarterly results. The Google parent reported Q2 revenue of $119.8 billion, up 24% year-over-year, with Google Cloud growing 82%. Alphabet also raised its capital spending forecast, reinforcing demand for AI infrastructure.
A Bear Market Reversal?
The KOSPI had fallen into a technical bear market recently, dropping as much as 28% from its June record high. The index has triggered multiple circuit breakers and sidecars this year during its decline. Despite the volatility, Citi maintains a 10,000 price target for the KOSPI, implying more than 50% upside from levels earlier in the week. Citi analysts called the recent pullback a potential buying opportunity, citing technical profit-taking rather than a shift in fundamentals.
Headwinds Remain
Rising oil prices and lingering Iran-related tension around the Strait of Hormuz tempered the rally without derailing it. The geopolitical risks add uncertainty to the outlook for export-driven South Korean stocks. The index's ability to hold above 7,000 will be tested in coming sessions as investors weigh the AI-driven rally against these pressures.
