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- South Korea's benchmark Kospi index rebounded dramatically to cap a roller-coaster week.
- Chip giants Samsung and SK Hynix powered a Friday rally in AI-linked chip stocks.
- The recent selloff may have helped cool excesses in the semiconductor space, KB Securities said.
South Korean stocks ended a turbulent week on firmer footing after a volatile stretch that underscored investors' sensitivity to swings in AI-related shares.
The country's benchmark Kospi index surged over 8% on Friday before paring gains to close the session up 4.6%, after President Donald Trump said the US was nearing a peace deal with Iran.
The rebound capped a rollercoaster week for one of the world's hottest stock markets. The benchmark index plunged over 8% on Monday as a selloff in US tech stocks rippled through Asia, before staging a sharp rebound and swinging for the rest of the week.
The Kospi finished the week down 0.5%, following a 3.7% decline the previous week.
The selloff hit the South Korean market particularly hard because of its heavy exposure to the global AI trade. The Kospi has more than tripled since the start of 2025, making it one of the world's best-performing — and most volatile — major stock markets.
As sentiment stabilized at the end of the week, investors returned to the semiconductor stocks that had borne the brunt of the downturn.
Seoul-based KB Securities said much of the valuation adjustment in semiconductor stocks has already taken place following the recent volatility.
"At present, however, much of that disparity adjustment has already taken place. This can be read as a sign that overheating in semiconductors has also largely eased," KB Securities analysts Euntaek Lee and Daeun Lee wrote in a Friday note.
On Friday, index heavyweight Samsung Electronics surged over 13% before closing 7.9% higher. Rival chipmaker SK Hynix, meanwhile, gained as much as 9.6% before ending 2.3% up.
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