South Korea's KOSPI Plunges Nearly 40 Percent From Its June Peak, Wiping Out Small Investors

According to Al Jazeera, published Saturday, Mordad 31, 1405 (August 22, 2026), South Korea's KOSPI index, which had surged an unprecedented 101.14 percent in the first half of this year from below 5,000 points to an intraday peak of 9,385.59 on June 19, gave back most of those gains by July 30, falling back below 5,595 points, a drop of nearly 40 percent from its peak. The index fell almost 6 percent on Wednesday, August 19. Per data from the Korea Financial Investment Association, margin loans used to fund stock purchases, which had reached 38.6 trillion won (27.6 billion dollars) at the June peak, fell to 28.9 trillion won (20.7 billion dollars) by the end of July, as brokerages liquidated the holdings of investors who could not cover their losses.

The boom and bust centered largely on two chipmaking giants, Samsung Electronics and SK Hynix, which together account for more than half the index's weight. Al Jazeera quoted Eun-bi, a civil servant in her thirties who had put most of her savings into the market ahead of her wedding next year, saying she lost tens of thousands of dollars and is now reconsidering her wedding budget. Approval ratings for South Korean President Lee Jae Myung, who had pledged to lift the KOSPI to 5,000 points, have fallen for five consecutive weeks, reaching 43 percent in an August 10-14 Realmeter poll, the lowest of his presidency.