Korean Kospi Rips To Record As Asian AI Trade Accelerates

South Korea's KOSPI gapped 4.70% higher at Monday's open, hitting a fresh all-time high as semiconductor stocks continued to dominate regional trading. SK Hynix led the charge, surging more than 10% on the day, with momentum carrying into Tuesday's session as the global AI chip trade extended its run.

SK Hynix and Samsung Fuel the Record Run

The move was not a one-day wonder. The KOSPI closed above the 7,800 mark, setting a record high for a fifth consecutive session as a surge in major semiconductor stocks drove the index higher. Samsung Electronics closed 6.33% higher at 285,500 won on Tuesday, while SK Hynix jumped 11.98% to 1.888 million won. The rally has been underpinned by a structural shift in demand. The surge is mainly fueled by expanding demand for AI infrastructure, with the supply shortage of High Bandwidth Memory (HBM) serving as the core narrative for this valuation growth. Reuters reported that SK Hynix has been inundated with "unprecedented" offers from major technology companies seeking to secure supplies of advanced memory chips, with some customers offering to fund new production lines and help finance costly ASML lithography equipment, as available chipmaking capacity has effectively run out.

Samsung Electronics and SK Hynix together made up a record 42.2% of the KOSPI in May, according to Manulife Investment Management. That concentration cuts both ways. Analysts have warned that reliance on a narrow group of exporters could amplify volatility and leave markets vulnerable to shocks ranging from geopolitical tensions to a slowdown in data-center spending. Still, the bull case remains intact for now. JPMorgan raised its base-case target for the KOSPI from 7,000 to 9,000 points and its bull-case target from 8,500 to 10,000 points, stating that the next two years could represent a sustained upcycle for memory chips.

A Divided Asia: AI Winners and Consumer Laggards

Beyond South Korea, the picture across Asia was more mixed, highlighting a clear divide between markets tied to AI infrastructure and those exposed to consumer spending. Japan's Nikkei 225 was in choppy trade and closed 0.47% lower, weighed down in part by a sharp drop in Nintendo. Nintendo shares fell over 8% as investors digested news that the game developer will hike Switch 2 prices while expecting a decline in console sales. In China, the CSI 300 added 1.64%, while Hong Kong's Hang Seng index was broadly flat. The contrast reinforces a theme that has been building across the region: AI-exposed markets are outperforming, while consumer-facing economies continue to stall.

Investing.com: KOSPI hits record high as SK Hynix, Samsung extend AI-fueled rally | Seoul Economic Daily: KOSPI Smashes 7,800 on Chip Rally | CNBC: Asia Markets Live Updates