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Kospi breaks 4,600 during trading, but signs of coming short sale growing

Published: 07 Jan. 2026, 18:38 Updated: 07 Jan. 2026, 19:53

The Kospi is seen at 4,611.72 points on an electric board in Hana Bank's trading room in Jung District, central Seoul, on Jan. 7, surpassing the 4,600-mark for the first time. [YONHAP]

The Kospi climbed above 4,600 during trading on Wednesday, as gains in Samsung Electronics, SK hynix and Hyundai Motor Company propelled Korea’s benchmark share index to intraday record levels.

Rising prices fueled fear of missing out, and margin trading, commonly referred to in Korea as "investing with debt," grew to its highest level on record.

At 9:10 a.m. on Wednesday, the Kospi hit an intraday peak of 4,611.72 points, surpassing the previous record of 4,525.48 set on Tuesday. The index cooled off in the afternoon, and by 2:30 p.m., individual investors sold a net 209.2 billion won ($145 million) worth of stocks while institutions offloaded 744.2 billion won.

Foreign investors stepped in with net purchases of 978 billion won, supporting the index’s lower range. The Kospi closed up 25.58 points or 0.57 percent at 4,551.06.

The market rally was led by major export stocks, with Samsung Electronics rising to around 140,000 won and SK hynix climbing to about 760,000 won early in the session.

Investors grew more optimistic ahead of Samsung Electronics’ fourth-quarter earnings announcement scheduled on Thursday, and a more than 10 percent surge in Micron Technology shares on Wall Street on Tuesday boosted investor appetite for semiconductor stocks.

Samsung Electronics HBM4, a sixth-generation high-bandwidth memory solution for AI and HPC applications, on display during the 2025 Korea Tech Festival in southern Seoul on Dec. 4, 2025. [REUTERS/YONHAP]

Gains in semiconductor stocks extended to the auto sector.

Hyundai Motor surged more than 13 percent during the session, reaching 362,000 won and posting a new record. Hyundai Group affiliates Kia and Hyundai AutoEver also set new records, with Kia reaching 130,500 won and Hyundai AutoEver climbing to 405,000 won.

The companies showcased AI and robotics products at CES 2026, while news of a private meeting between Hyundai Motor Group Executive Chair Euisun Chung and Nvidia CEO Jensen Huang fueled investor optimism.

Boston Dynamics Atlas robots are displayed in the Hyundai Motor Group booth during CES 2026 in Las Vegas, Nevada on Jan. 6. [REUTERS/YONHAP]

“Hyundai Motor is emerging as a leader in the era of physical AI, driven by growing market interest in Boston Dynamics’ humanoid robots and its expanding partnership with Nvidia,” said NH Investment & Securities analyst Ha Neul.

Kospi’s four‑day surge coincided with a sharp rise in leveraged trading.

Data from the Korea Financial Investment Association showed that as of Monday, outstanding margin loan balances reached 27.6 trillion won, surpassing the previous record of 27.5288 trillion won set on Dec. 17, 2025. Margin loan balances refer to the amount investors borrow from securities firms to buy stocks without having repaid the debt, serving as a key indicator of leveraged investing.

Stock lending balances also rose sharply. As of Tuesday, the stock lending balance for Samsung Electronics reached 13.3 trillion won, a record high, and SK hynix’s balance exceeded 13 trillion won.

When stock lending balances go up, it usually means more shares are being borrowed to prepare for short selling. As the index passed 4,600 for the first time, many investors began preparing to bet on a price drop, indicating that short-selling money has piled up to its highest level yet.

“Using borrowed money to invest can make stock prices fall even more when the market drops, because forced selling adds extra pressure,” said Lee Bo-mi, a research fellow at the Korea Institute of Finance. “In 2022, when the market went down, stocks that had high levels of margin loans in 2021 dropped more than others.”

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY PARK YU-MI [[email protected]]