South Korea’s benchmark Kospi bounced back on Friday, gaining 2.05% to end a seven-session losing streak, but the recovery did little to repair what became the market’s worst week since the 2008 global financial crisis, Yonhap reported via the Korea JoongAng Daily.
The index rose 113.83 points to close at 5,668.05 on October 16, after touching an intraday high of 5,809.94. Gainers swamped decliners by 757 to 134, with about 286.5 million shares worth 20 trillion won changing hands.
The rebound followed a brutal Thursday session in which the Kospi plunged 7.57% to 5,554.22, triggering a 20-minute circuit-breaker halt as chip giants Samsung Electronics and SK hynix tumbled by roughly 9.5% and 11% respectively, according to Bloomingbit and Benzinga.
Worst weekly drop in 18 years
Even with Friday’s bounce, the Kospi lost 14.46% over the week, Benzinga reported, the steepest weekly decline since October 2008, when the index shed 20.5% in the aftermath of Lehman Brothers’ collapse. The outlet noted that the selloff exceeded even the pandemic crash of March 2020 on a weekly basis.
The pain was concentrated in semiconductors. SK hynix finished the week down 24.3% and Samsung Electronics fell 17.8%, both their worst weekly performances since 2008, according to Benzinga. The Kospi now sits nearly 38% below its record close of 9,114.55, though it remains about 34.5% higher for 2026 as a whole.
The rout has been driven by mounting worries over the debt used to fund the artificial intelligence build-out, alongside hotter-than-expected US inflation data that revived expectations of Federal Reserve rate hikes. SBS News noted that US producer prices rose last month at their fastest pace in four and a half years.
Chipmakers and carmakers lead the bounce
On Friday, Samsung Electronics added 2.62% to 215,500 won, while SK hynix edged up 0.79% to 1,272,000 won. Gains were broader elsewhere: Hyundai Motor jumped 5.58%, Hanwha Aerospace climbed 7.77% and Celltrion rose 6.53%, Yonhap said.
Foreign investors turned net buyers by the close, picking up 343.5 billion won worth of shares, while retail and institutional investors were combined net sellers of 1.17 trillion won.
Sentiment was helped by comments from Fed Chair Kevin Warsh at the IMF-World Bank annual meetings in Bangkok. Warsh struck an upbeat tone on the US economy and described AI as “probably the most consequential change” to the global economy in his lifetime, though he gave no clear signal on whether the Fed would raise rates this month. Seo Sang-yong of Mirae Asset Securities told Yonhap it was meaningful that the Fed chief had kept a positive view of the AI industry’s structural growth.
Nvidia chief executive Jensen Huang also sought to calm nerves around AI infrastructure lender risk, saying on Thursday that CoreWeave’s financial position was strengthening, after the cloud provider’s shares sank more than 15% midweek as its bond yields spiked toward 15%.
What’s next
Investors will be watching whether foreign buying holds after Friday’s reversal, and whether the Fed moves on rates later this month. With Korea’s market heavily weighted toward Samsung and SK hynix, the direction of global AI and chip stocks is likely to remain the key swing factor for the Kospi in the weeks ahead.
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