South Korean Kospi Index Drops 39 Percent Amid Tech Slump

The South Korean Kospi index experienced a sharp decline between mid-June and the end of July 2026, dropping 39 percent from its mid-June peak. This downturn occurred while U.S. stock indexes remained in a holding pattern during the same period.

Samsung Electronics and SK Hynix, the semiconductor companies that dominate the index, drove the majority of the decline. The market later saw a brief recovery as investors shifted toward an AI-momentum trade. This short-term rebound followed news regarding "Situational Awareness," which triggered a recovery fueled by investor fear of missing out.