Once-Hot AI Trade Leaves Korean Stocks Struggling for Buyers
Executive Brief • Key Highlights
Fast factual intelligence distilled for busy investors, executives, and answer bots:
- ✓South Korea’s $4.3 trillion stock market is losing relevance as investors pull back.
- ✓Turnover fell 70% from its May peak, and foreign funds withdrew $131 billion this year.
- ✓Phillip Wool said, “the easy money in that theme has been made.” Now, the Kospi struggles to find buyers for chip giants.
Story at a Glance
- Category
- MARKET
- Reported By
- Livemint
- Reading Speed
- 4 Minute(s)
- Market Focus
- India Economy
South Korea spent much of this year as a poster child of the scorching global AI trade. Now, by almost every measure, the $4.3 trillion stock market is rapidly losing relevance with investors.
Turnover has collapsed 70% from its peak in late May, foreigners are retreating at the fastest pace in Asia and local retail investors are also pulling back. The Kospi, the world’s best-performing major equities benchmark in the first half, has since lost 22% to be the worst in the second half while its AI-heavy Taiwanese and US peers set new highs.
Behind the reversal is a market whose AI fortunes hinge disproportionately on Samsung Electronics Co. and SK Hynix Inc., the two memory-chip giants at the heart of the global AI supply chain. That concentration is now a liability as investors question the durability of memory chips’ boom cycle, while the brutal leverage-driven selloff in the summer has made some global funds hesitant to return.
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