The KOSPI closed above 7,000 for the first time in about six weeks, shrugging off escalating tensions in the Middle East and a surge in global oil prices. Expectations of expanding artificial intelligence investment lifted semiconductor shares and supported the index. Market participants expect the spread of long-term supply agreements, or LTAs, with hyperscalers to reduce volatility in the memory chip industry and improve earnings visibility, a shift that would also benefit the KOSPI.
The KOSPI ended at 7,051.64 on the 9th, up 97.12 points, or 1.40%, from the previous session, according to the Korea Exchange. It was the first close above 7,000 in 33 trading sessions, since July 23, when the index finished at 7,096.89. The benchmark had stalled just below the threshold on the 7th and the 8th before clearing it on the third attempt. The KOSDAQ closed at 830.37, up 2.28%.
Chip stocks drove the advance, buoyed by OpenAI's Astra and expectations of broadening AI demand. SK hynix (000660) closed at 1.856 million won, up 3.51%, and shares of semiconductor materials, parts and equipment makers rose alongside it. Buying also spread to secondary battery, AI infrastructure and optical communications names.
One concern is the retreat of individual investors, who sold a net 2.2874 trillion won on the day and 16.8356 trillion won over five consecutive sessions. Investor deposits at brokerages, a gauge of cash waiting to enter the market, stood at 96.9863 trillion won, below the 100 trillion won mark since the 2nd.
Analysts say that for the KOSPI to hold above 7,000 and extend gains, the durability of the chip cycle must underpin the rally, not just short-term AI enthusiasm. At the 2026 KB Financial Group Korea Conference held the same day, speakers argued that the current semiconductor cycle is turning more stable than past ones.
"The semiconductor industry is undergoing a structural change from the past, toward a market structure that is more stable and less affected by cycles," said Kim Shin, global investment strategist at KB Financial Group.
Long-term supply agreements are at the center of that shift. Memory prices and earnings once swung sharply with changes in supply and demand, but hyperscalers leading AI investment are now locking in the memory volumes they need over extended periods, expanding LTAs with chipmakers. With a certain level of demand secured in advance, short-term price swings have less impact on earnings, according to the assessment.
That is positive for the KOSPI, where chipmakers carry heavy weight. The less volatile the profits of Samsung Electronics (005930) and SK hynix become, the clearer the earnings outlook for the entire index. Kim said the gap in price-to-book ratios could also narrow if Korean chipmakers improve earnings stability and consistency as TSMC has.
A structural increase in memory demand from the spread of AI also supports the cycle's durability. Kim Dong-won, head of the research center at KB Securities, forecast that memory demand could rise to about three times current levels once agentic AI takes hold, and up to 10 times at the stage of physical AI such as humanoid robots. New production facilities, by contrast, take three to four years to translate into actual supply, he said, leaving open the possibility that the memory shortage persists through 2028.
He also projected that memory's share of AI investment will expand to 57% next year from about 40% this year. TrendForce expects the figure to reach 68% that year. Kim said the profit center of the AI industry will shift from graphics processing units to memory starting next year, with earnings improvements at Samsung Electronics and SK hynix bolstering the KOSPI's profit outlook.
Risks remain. Kim Shin warned that demand for AI chips is concentrated among a small number of large hyperscalers, and that any pullback in their investment could revive volatility in the industry. He also pointed to the high volatility of the domestic stock market as an obstacle to further re-rating. "Personally, I believe the discount on the Korean market owes more to market volatility and the herd psychology of investors than to corporate governance," he said. "Without leveraged exchange-traded funds, a considerably sound and sustainable rally would have been possible."
