KOSPI Has Burst into a Bullish Trend: Explosive Growth of Chipmakers Added 20% to the Index
The South Korean stock index KOSPI has confidently returned to a bull market phase, showing an impressive gain of more than 20% from July lows. The key driver of this powerful rally was the recovery of global memory and semiconductor manufacturer stocks, signaling a resurgence in global chip demand.
Sandisk Breakthrough: New Strategy Inspired Investors
The spark that ignited the market came from Sandisk (SNDK). On Thursday, its shares jumped 13.7% after top management presented an ambitious long-term development strategy through 2030. The company is targeting a sustainable double-digit compound annual growth rate in revenue and maintaining an adjusted gross margin at a high level of around 80%. CFO Luis Visoso also announced a capital return program to shareholders, stating that all excess cash flow after investments would be directed toward share buybacks and dividends.
This news was immediately reflected in stock prices: Sandisk shares closed at $1528.11. Evercore ISI analysts, including Amit Daryanani, noted an impressive portfolio of long-term agreements totaling $93.9 billion, including contracts with three major US data center operators, which formed the basis for a "buy" recommendation.
Wave of Growth Swept Across Asia and the US
The positive momentum from Sandisk quickly spread across the entire sector. Micron (MU) shares rose 4.2%, while South Korean giant SK Hynix gained 7.3%. Hard drive manufacturers Seagate (STX) and Western Digital (WDC) also reported solid gains of 4.9% and 7.3%, respectively. On Friday, the rally continued on Asian markets: Japan's Nikkei 225 rose 1.73%, and the KOSPI strengthened another 2.11%, breaking through the psychologically important level of 7000 points for the first time in 15 trading sessions. The small-cap index KOSDAQ, which had previously shown resilience even during the downturn, also rose 0.84%.
Bull Market Resilience: Between Optimism and Caution
However, not all market participants are ready to unconditionally call the current growth the beginning of a long-term uptrend. Peter Kim from KB Securities believes the previous decline was driven more by technical factors and capital reallocation rather than deteriorating fundamentals among semiconductor manufacturers. In his assessment, forced liquidation of credit positions is already subsiding.
On the other hand, Jeong In Yun from Fibonacci Asset Management Global urges caution, emphasizing that he would not call this "a completely new bull market." The index gained more than 10% over five trading days ahead of the long weekend in South Korea, and foreign capital inflows could temporarily hold the 7000 level. Further dynamics will depend on how long the optimism generated by Sandisk's forecasts can support the rest of the memory sector companies.
Analytical commentary: The current growth looks fundamentally justified, given Sandisk's real contracts and the recovery in memory demand for AI data centers. Nevertheless, a sharp 20% move over a short period often triggers a correction. Investors should watch the sustainability of fund inflows into Asian ETFs and whether SK Hynix and Samsung quarterly reports confirm the expectations priced into stocks. For now, the market is moving on emotion, but the foundation appears stronger than in previous cycles.