South Korean stocks concluded a turbulent week on a positive note, reflecting heightened investor reactions to fluctuations in artificial intelligence (AI) stocks. The benchmark Kospi index saw a significant surge of over 8% on Friday, although it moderated its gains to finish the day up 4.6%. This rebound followed remarks from former President Donald Trump, who suggested that the United States was on the verge of a peace agreement with Iran, boosting investor sentiment.
The week was marked by extreme volatility, beginning with a sharp decline where the Kospi fell more than 8% on Monday, triggered by a widespread selloff in U.S. technology shares that impacted markets across Asia. Despite Thursday’s gains, the Kospi concluded the week down 0.5%, having experienced a 3.7% decline the week prior.
This recent downturn particularly affected South Korea due to its substantial exposure to the global AI sector. Since the beginning of 2025, the Kospi has more than tripled, establishing itself as one of the world’s top-performing and most erratic major stock markets.
As the week wound down, investor confidence gradually returned, especially towards semiconductor stocks, which had been hit hardest during the downturn. Analysts from Seoul-based KB Securities noted that much of the necessary valuation adjustments in semiconductor stocks had already occurred amidst the recent market volatility. They commented that the overheating in this sector had largely dissipated, suggesting a potential stabilization.
On Friday, industry giant Samsung Electronics saw a remarkable surge, trading up over 13% at one point before ultimately closing with a 7.9% gain. Similarly, rival company SK Hynix experienced a peak increase of 9.6% before settling with a 2.3% rise, reflecting a rebound in investor interest in semiconductor stocks as sentiment improved.
