South Korea’s KOSPI rebounds as scrutiny of leveraged ETFs and chip volatility deepens
The benchmark rose more than 5% after a sharp sell-off tied to Samsung Electronics and SK Hynix, while regulators faced growing concern over $9.1 billion in single-stock leveraged ETFs dominated by retail investors.
South Korea’s KOSPI rebounded more than 5% on Thursday, July 9, after a prior 5.35% slide had pushed the benchmark to 7,246.79, its lowest close since May 20 and more than 20% below its June 22 record of 9,114.55. Samsung Electronics rose 6.5% and SK Hynix gained 2.7%, helping lift the index back above the conventional bear-market threshold. The sell-off and rebound came amid sharp volatility in semiconductor shares and intensifying scrutiny of South Korea’s 16 single-stock leveraged ETFs, which grew from roughly $3 billion at their May 27, 2026 launch to about $9.1 billion within weeks and were held about 92% by retail investors. Officials and analysts said concerns over AI-demand expectations, memory-price growth, chip earnings and the daily rebalancing of leveraged ETFs would remain key to whether the recovery holds.
- leveraged single-stock ETFs: Exchange-traded funds designed to amplify the daily move of an individual stock, often increasing volatility and risk.
- bear market: A market decline of 20% or more from a recent peak.
- daily rebalancing: Resetting fund leverage each trading day, which can amplify market moves.