South Korean KOSPI Closes Above 5,000 as Market Defies Trump Tariff Threat

Updated 2026-01-27 07:40:35+00:00 (46 articles)

KOSPI breaks 5,000 barrier after early‑day tariff shock The index surged 135.26 points to end at 5,084.85, the first close above the 5,000 mark, despite a 0.84 % dip in early trade when President Trump announced plans to raise U.S. tariffs on Korean goods to 25 % [1][2]. The rally erased the early loss and set a new record high for the day. Traders cited the move as a short‑term reaction to the tariff news rather than a fundamental shift.

Heavy volume and divergent investor flows drive price action Market participants exchanged 472 million shares worth roughly 28 trillion won, indicating robust activity [1]. Foreign investors posted a net purchase of 850 billion won, while domestic retail investors sold about 1 trillion won, highlighting contrasting sentiment between overseas and local participants [1][2]. Institutional investors added a net 232 billion won, supporting the upward momentum.

Semiconductor leaders hit all‑time highs, boosting the rally Samsung Electronics rose 4.87 % to a record 159,500 won and SK hynix jumped 8.7 % to an unprecedented 800,000 won, leading the technology surge [1]. These gains offset modest declines in other sectors and underscored the market’s reliance on chip makers for growth. Analysts noted that expectations for fourth‑quarter earnings are already priced in, but the tariff news did not dampen chip demand.

Bond yields slipped as investors sought safety The three‑year Korean Treasury yield fell 0.2 basis point to 3.094 % and the five‑year benchmark slipped 0.5 basis point to 3.377 % [1]. The modest decline reflected a shift toward fixed‑income assets amid heightened geopolitical uncertainty. Lower yields complemented the equity rally by reducing financing costs for corporations.

Tariff announcement triggered currency and sector pressure The won weakened to 1,446.2 per dollar after Trump’s tariff warning, but quickly recovered as the market steadied [1][2]. Automakers such as Hyundai and Kia fell 3–5 % in early trade, while utilities like KEPCO rose, showing sector‑specific reactions [2]. The episode demonstrated the market’s resilience to policy shocks when anchored by strong tech performance.

Sources (9 articles)

Timeline

Oct 27, 2025 – The KOSPI clears the 4,000‑point barrier for the first time since 1983, surging more than 70 % year‑to‑date on AI‑driven optimism, rate‑cut expectations and market‑reform momentum, while President Lee Jae Myung pledges to lift the index above 5,000 with new corporate‑value reforms[24].

Dec 8, 2025 – The KOSPI climbs 1.34 % to 4,154.85 ahead of the U.S. Federal Open Market Committee meeting, as investors price in a likely 0.25 ppt rate cut; foreign investors net‑buy 321.3 billion won while locals sell, and Samsung and SK hynix rise on a positive tech outlook[29].

Dec 14, 2025 – The index opens 2.09 % lower at 4,080.01 as renewed AI‑bubble fears hit large caps; President Donald Trump is reported to be weighing former Fed governor Kevin Warsh as his top Fed‑chair candidate[28].

Dec 15, 2025 – The KOSPI falls 1.84 % to 4,090.59 amid concerns that U.S. AI spending may not be profitable, with Samsung down 3.76 % and SK hynix down 2.98 %[27].

Dec 16, 2025 – The index drops 2.24 % to 3,999.13, the first sub‑4,000 close in a week, as analysts cite AI‑sector volatility and investors await U.S. payroll data; Samsung falls 1.91 % and SK hynix 4.33 %[26].

Dec 17, 2025 – The KOSPI opens 1.33 % lower at 4,002.6, reflecting AI‑valuation worries after a major investor pulls out of Oracle’s data‑center project; the won strengthens to 1,478.5 per dollar[25].

Dec 30, 2025 – The benchmark ends the year at 4,214.17, up 75.7 % from the start of 2025, while foreign ownership reaches a five‑year high of 32.9 % of market cap, driven by massive purchases of Samsung and SK hynix shares[22].

Jan 2, 2026 – The KOSPI closes at a record 4,309.63, a 2.27 % gain led by semiconductor stocks; President Lee Jae Myung and Chinese President Xi Jinping plan to discuss peace and denuclearisation during a Beijing summit[23].

Jan 4, 2026 – Foreign investors hold 32.9 % of South Korean market capitalisation, the strongest level since April 2020, after net buying of 3.5 trillion won in December, especially in electronics[22].

Jan 5, 2026 – The KOSPI jumps 3.43 % to 4,457.52, a record high, as Samsung Electronics surges 7.47 % to a six‑year high and AI‑driven chip optimism fuels broad tech buying[21].

Jan 6, 2026 – The index breaks the 4,500‑point mark for the first time, closing at 4,525.48 after a rally led by technology, brokerage and shipbuilding stocks; retail investors buy 597.5 billion won, offsetting foreign and institutional selling[20][19][18].

Jan 7, 2026 – The KOSPI opens sharply higher, jumping 69.37 points to 4,594.85 and briefly trading above 4,600; it later closes at an all‑time high of 4,551.06 after Hyundai Motor rockets 13.8 % following Hyundai‑owned Boston Dynamics’ Atlas robot demo at CES, while foreign investors net‑buy 1.25 trillion won[17][16][15].

Jan 8, 2026 – Seoul shares open higher, with the KOSPI up 5.27 points to 4,556.33, driven by defense and shipbuilding gains such as Hanwha Aerospace’s 8.12 % surge, despite mixed U.S. market moves[14].

Jan 9, 2026 – The KOSPI hits a fresh record near 4,600, closing at 4,586.32 as autos, defense and shipbuilding lead the rally; foreign investors sell for a second straight session, offloading 1.59 trillion won[13].

Jan 11, 2026 – The National Pension Service’s listed‑share holdings jump 35 % to 266.1 trillion won, powered by a 63.9 % rise in Samsung and a more‑than‑double gain in SK hynix, underscoring the pension fund’s exposure to the tech rally[12].

Jan 16, 2026 – Former President Yoon Suk Yeol is sentenced to five years in prison for obstructing investigators over his 2024 martial‑law decree[9]; the same day, President Lee Jae Myung convenes a bipartisan luncheon with ruling and opposition leaders to foster cross‑party cooperation[10]; the KOSPI opens above 4,800 for the first time, closing at a record 4,840.74, while North Korea prepares large‑scale youth events ahead of its party congress[9][10][11].

Jan 19, 2026 – The KOSPI tops 4,900 intraday at 4,917.37 and closes at a record 4,904.66, extending a 12‑day rally driven by auto and tech stocks; the surge follows President Trump’s threat of new tariffs on eight European nations over his Greenland plans[8][7].

Jan 22, 2026 – The index briefly breaches the 5,000‑point level intraday at 9:01 a.m., less than three months after crossing 4,000, as U.S. equities rally on President Trump’s retreat from Greenland‑related tariffs[6].

Jan 25, 2026 – Foreign ownership of South Korean equities climbs to a five‑year high of 37.18 % of market cap, driven by net purchases in shipbuilding, defense and nuclear‑power sectors, with Samsung alone attracting 14.1 trillion won of foreign money in H2 2025[5].

Jan 26, 2026 – The KOSPI slips 0.81 % to 4,949.59 ahead of the U.S. Fed’s rate decision, while the tech‑heavy KOSDAQ jumps over 7 % to breach the 1,000‑point level; the won strengthens sharply to 1,440.6 per dollar and investors await earnings calls and the Fed outcome[3]. In the same session, the index falls 0.48 % to 4,966.03 as traders watch for possible U.S. intervention in Iran’s unrest[4].

Jan 27, 2026 – The KOSPI closes above 5,000 for the first time at 5,084.85, with semiconductor giants Samsung and SK hynix hitting record highs; foreign investors net‑buy 850 billion won despite President Donald Trump’s announcement that “reciprocal” tariffs on Korean autos, lumber and pharma will rise to 25 %[1]. Earlier that morning, the index had slid 0.84 % to 4,908.20 after Trump’s tariff warning, dragging down Hyundai, Kia and Samsung shares[2].