Kospi Posts Record 14% Rebound on AI Trade Optimism
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- Kospi surged 14% on Friday in its largest one-day jump on record, per LSEG data, with SK Hynix and Samsung Electronics both posting record rebounds alongside the index.
- The rally followed an overnight U.S. tech surge fueled by upbeat earnings from Microsoft, Amazon, and Meta that reinforced expectations that AI infrastructure spending remains robust.
- SK Group Chairman Chey Tae-won disclosed purchases of SK Hynix shares, bolstering confidence in the world's second-largest memory chipmaker, according to the report.
- Jung In Yun of Fibonacci Asset Management attributed the move to foreign investors, amplified by short-covering and mechanical rebalancing by leveraged ETFs, with new cash-deposit requirements for leveraged ETF investors taking effect July 31 potentially contributing to repositioning.
- Rolf Bulk of Futurum Group said the AI investment cycle remains intact, noting forced selling appears to have largely run its course and there are no signs of the AI infrastructure build-out slowing.
- Paul Gambles of MBMG Family Office warned that 'asset prices are completely disconnected' and that the sharp rally could be a one-day relief within an unstable market, cautioning that heavy leverage could leave markets vulnerable to a much larger correction.
Why it matters: Both analysts cited say the Friday move was driven largely by short-covering and leveraged ETF rebalancing rather than a fundamental shift, with Jung calling the real test whether foreign buying continues after positioning effects fade. Gambles warned that 'asset prices are completely disconnected' and that combined heavy leverage and fragile confidence could leave markets exposed to a much larger correction.
