After crossing KRW 5,001, the KOSPI Composite index continued to rise. This month it reached a new record of KRW 5380, which means that the index has increased by 132% since its low in 2025. It is now one of best performing indices worldwide.
The article will explain why the KOSPI has been on an unstoppable run of bulls and whether or not it’s a good buy at this point, as it becomes extremely overbought.
South Korean stock prices continue to rise as AI concerns fade
In the last few months the KOSPI index has seen a bullish run, aided by President Lee Myung-bak’s ongoing policies of friendliness, which he predicted would lead to a jump up to KRW 5,001.
The rally was boosted after South Korea reached an agreement with the United States last year. Donald Trump reduced tariffs as part of this deal in exchange for South Korean investment in the United States.
As artificial intelligence has gained momentum, the KOSPI index has flourished. South Korea, which is home to some of the largest players in this industry (including Samsung and SK Hynix), is a key factor.
On Tuesday the index rose, mirroring its American counterparts such as the Nasdaq 100, and S&P 500, both of which reached their highest levels this week.
Google’s $20 billion bond offering, its largest in US dollars to date, has helped ease fears about the AI industry. The company is looking to increase its AI expenditure. Last week, four of the largest companies announced that they will spend $660 billion this year on AI.
These spendings will help boost the top South Korean firms, particularly those who make memory products. SK Hynix – a leading memory manufacturer that provides products to NVIDIA – has risen by 150% in the last nine months, and Samsung is up by 40%.
Recent data also showed that South Korean economic growth continues. The consumer inflation rate has dropped to its lowest level since five months. Meanwhile, the manufacturing PMI rose to its highest level for 17 months.
A report also showed that the surplus trade moved to a surplus and its export growth increased at the fastest rate since 2021. In 2025, its current surplus reached a new record.
The won is also falling because foreigners continue to move into South Korea.
The KOSPI Composite index has seen a rise in most companies this year. Mirae Asset has soared 124% in the past year. Daewoo Engineering and Hanwha Systems have also seen double-digit increases.
KOSPI Composite Index Technical Analysis
Weekly chart showing the KOSPI index in strong upward trend in recent months. From a low KRW 2,308 last April to KRW 5310 this week.
The price has moved up above both the 100-week and 50-week Exponential moving averages (EMA), as well as the Supertrend indicator. This is a good sign for bulls, who are still in charge.
However, the main concern is the fact that both the Relative Strength Index and Stochastic Oscillator continue to rise and now are comfortably at the level of overbought.
The most probable scenario would be for the Index to continue rising near-term, then a possible pullback towards the KRW 5,001 key support level.
The post KOSPI index rallies, gets overbought and the AI boom gains momentum may be updated as new developments unfold.
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