AI Partnerships Ignite the Seoul Market

South Korea’s benchmark KOSPI Composite Index logged a historic rally in October, advancing 20% — its best monthly performance since 2001. The catalyst was clear: NVIDIA’s strategic AI chip collaborations with Samsung Electronics and SK Hynix, two of Asia’s largest semiconductor producers.

These partnerships are designed to accelerate the next generation of AI-driven memory and processing solutions, cementing South Korea’s position at the heart of the global semiconductor supply chain. The deals sparked a surge in institutional inflows, as global investors sought exposure to the companies driving the artificial-intelligence revolution.

A Market on Fire: KOSPI Soars 76% YTD

By early November, the KOSPI Index traded around 4,221 points, representing a 76% year-to-date gain — outpacing most global benchmarks, including the NASDAQ 100 and India’s NIFTY 50.

This momentum highlights not only the strength of Korea’s tech sector but also the confidence of international investors in its long-term fundamentals. The rally has been broad-based, with semiconductors, industrials, and financial technology stocks leading the charge amid rising export activity and favorable macro conditions.

Semiconductors Lead the Charge

The backbone of this rally remains the semiconductor industry, which now dominates both Korea’s economy and its stock exchange. Samsung Electronics and SK Hynix, together accounting for roughly one-third of the KOSPI’s total weight, have seen their valuations surge in tandem with global AI demand.

Other sectors, including automotive, shipbuilding, and industrial automation, also benefited as South Korea positioned itself as a global supplier of advanced manufacturing solutions. A stable won and moderating inflation further bolstered investor sentiment, offering a stark contrast to the higher volatility seen in U.S. and European markets.

Can the Momentum Hold?

Analysts remain divided on whether the rally can extend into 2026. Some warn of a short-term technical correction after such steep gains, while others argue that Korea’s deep integration in the AI and chip ecosystems will sustain the uptrend.

If the semiconductor cycle continues its current trajectory, South Korea could emerge as one of the primary beneficiaries of the global AI investment boom — transforming the KOSPI from a regional index into a core holding for institutional investors worldwide.