Key points
- Kospi rose 4.40% Thursday, its third straight green day and its first close back above 7,000 in five trading days. Kosdaq gained 5.22% too.
- The move traces back to Alphabet, which raised its 2026 spending guidance to $195 billion to $205 billion, easing worries that AI-driven memory chip demand was starting to slow.
- Foreign investors bought a net 2.135 trillion won ($1.42B USD) of Kospi stocks, and more than 1.3 trillion won of that ($877M USD) went into SK Hynix alone, with individual investors selling into the rally.
- Samsung Electro-Mechanics rose about 7.66% on its own news, a new 295.12 billion won ($197M USD) contract to supply AI server parts to an unnamed global technology company.
Kospi is up for a third straight day now. It's up 4.40% on Thursday, its best single-day in weeks, and put the index back above the 7,000 mark for the first time in five trading days. Kosdaq gained more than 5% on the same day. It was not a smooth ride to get there. Both indexes swung around earlier in the session before finishing strong.
What Alphabet said
Alphabet, Google's parent company, said it would spend more on AI this year than it first planned, raising its 2026 spending guidance to $195 billion to $205 billion. That is what brought investors back to Korean chip stocks. Samsung Electronics and SK Hynix produce many of the memory chips that power AI data centers, and the market's biggest worry lately has been "memory peak-out," the idea that AI-driven demand for memory has already hit its high point and is about to slow. A bigger spending number from one of the largest cloud companies in the world argues the opposite. Kiwoom Securities analyst Han Ji-young said, "Alphabet's strong earnings and raised capital expenditure guidance eased concerns about memory cycle peak-out for domestic semiconductor stocks."
Foreign investors bet big, and mostly on one stock
Foreign investors bought a net 2.135 trillion won ($1.42B USD) of Kospi-listed stocks Thursday, while individual investors sold into the rally instead.
Foreign investors picked a clear favorite. They put 1.3159 trillion won ($877M USD) into SK Hynix alone, more than three times the 350.4 billion won ($234M USD) they spent on Samsung Electronics. SK Hynix stock rose 4.86%, while Samsung Electronics gained a smaller 3.65%. The Korean won also strengthened, to 1,466.8 per dollar, matching the day's foreign buying.
Samsung Electro-Mechanics had its own good news
Samsung Electro-Mechanics rose about 7.66% Thursday on news separate from the Alphabet story. The company signed a 295.12 billion won ($197M USD) contract to supply MLCCs, a small ceramic part used to stabilize electrical current, for AI servers and data center systems to an unnamed global technology company, running from January through December 2027. An AI server can need more than 10 times as many MLCCs as a standard server, up to 600,000 of them in a single rack, and Samsung Electro-Mechanics says it holds more than 40% of the global market for that specific part. Chief executive Jang Deok-hyun said the deal reflects "recognition of Samsung Electro-Mechanics' MLCC technology as a core component of AI infrastructure." It is the company's third large AI-server supply deal announced since May, after a 1.5 trillion won ($1B USD) silicon capacitor contract and a 450 billion won ($300M USD) MLCC contract in June.
Thursday's gain does not undo the past month. Kospi is still down about 24% from its own intraday record of 9,385.59, set before a stretch that included the worst one-month drop of any major economy in the world and repeated single-day swings of 4% or more in both directions. Wednesday, SK Hynix opened up almost 9% and closed the day lower. Thursday, the same stock closed near its session highs instead. Whether Alphabet's spending plans mark a real turn or just another volatile day in a volatile month is something only the next few sessions will show.
Sources
- Herald Corp (Korean language): Kospi recovers 7,000 level intraday as memory peak-out worries ease, foreign investors buy for a fourth straight day, July 23
- Ajunews (Korean language): foreign investors bet 2 trillion won, Kospi nears 7,100 as Kosdaq rises 5%, July 23
- Edaily (Korean language): Samsung Electro-Mechanics signs 300 billion won MLCC supply deal with global big tech company, July 23
Figures are from South Korean market reporting as described above, converted to US dollars at roughly 1,500 won to the dollar. This is general market commentary and not investment advice. Always do your own research and consider speaking with a licensed financial professional before making any investment decision.
