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South Korean Stocks Swing Sharply After First Break Above 8,000; KOSPI 200 Futures Trigger Circuit Breaker; Fidelity International Says Tech Giants Still Investing Heavily in AI
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As markets await a meeting between Chinese and US leaders, major Asia-Pacific stock markets generally moved lower today (15th). South Korea's Kospi fluctuated sharply, briefly rising above the 8,000 level for the first time in history this morning. It once climbed 0.8% to a record high of 8,046 before profit-taking emerged, reversing course. It was last reported at 7,578, down 402 points or 5.05%. The Korea Exchange triggered a circuit breaker for the KOSPI after KOSPI 200 futures fell 5%, with program trading suspended for 5 minutes. Two heavyweight stocks dragged the broader market lower. Samsung Electronics (005930.KS) fell 7%. The South Korean government said it is not currently considering initiating emergency arbitration over a strike at Samsung Electronics. SK Hynix (000660.KS) also dropped 6.6%. Hyundai Motor declined 1.7%. The Kospi has surged at a remarkable pace recently, nearly tripling over the past year, raising concerns over whether corporate earnings and AI-related spending can justify the sharp rally. Foreign investors have recorded net outflows from the South Korean stock market on every trading day this week. Bullish views argue that South Korean equities still have upside potential. The Kospi is currently trading at a forward price-to-earnings ratio of 8.6x, compared with 21.2x for the S&P 500. According to foreign media reports, Ian Samson, portfolio manager at Fidelity International, said that if one believes the market is in a bubble, investors would need to assume that the scale of spending by AI giants is unsustainable. Essentially, all of their free cash flow, and even more, is now being poured into an arms race to build AI infrastructure. For now, there is ample evidence that this race will not end anytime soon. KB Securities recently raised its 2026 KOSPI target significantly from 7,500 to 10,500. The institution believes that expanding investment in AI infrastructure is driving upward revisions to earnings expectations for sectors such as semiconductors. KOSPI earnings improvement is outpacing the indexs rise, helping to ease valuation pressure. (da/a) Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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