South Korea will hold an emergency market meeting to address recent turmoil in the Kospi, the country’s primary stock market index. The decision comes in the wake of heightened volatility that has triggered urgent discussions among market regulators and stakeholders. This development underscores the sensitivity of South Korean equities to recent market pressures and highlights the government's readiness to intervene to stabilize investor confidence.

The announcement was first reported by Bloomberg, which noted that the emergency session aims to assess the causes of the disruption and outline potential measures to restore stability. While specific details regarding the agenda or proposed interventions have not been disclosed, the timing suggests a direct response to immediate market concerns.

Regulatory Response

The emergency meeting reflects a proactive stance by South Korean authorities to monitor and manage market fluctuations. In previous instances of similar volatility, such meetings have served as platforms for regulators to communicate with institutional investors and clarify policy directions. The focus is likely to be on ensuring liquidity and preventing further panic-driven selling.

Market Context

The Kospi has been under scrutiny due to broader global economic uncertainties and domestic factors influencing investor sentiment. The decision to convene an emergency session indicates that the current level of turmoil exceeds normal market noise, warranting high-level intervention. Investors are advised to stay informed as developments from the meeting could influence short-term trading strategies.

South Korean equities have emerged as the top global performers in 2026, driven by a massive rally in high-bandwidth memory (HBM) stocks essential for artificial intelligence infrastructure. The iShares MSCI South Korea ETF (EWY) has gained 112% year-to-date through June 16, delivering 11 times the return of the S&P 500. This surge positions South Korea as the primary beneficiary of the AI buildout, outperforming all other single-country ETFs tracked by CountryETFTracker.

The AI Memory Super-Cycle

The rally is concentrated in two Seoul-listed giants, SK Hynix Inc. and Samsung Electronics Co., which manufacture the overwhelming majority of the world's HBM. These specialized stacked DRAM chips are critical components for Nvidia Corp.'s AI accelerators. As demand for AI infrastructure exploded in 2026, order books and pricing power for these Korean manufacturers expanded significantly.

SK Hynix, the largest position in EWY at 23.17% of assets, has surged 266.64% year-to-date. Samsung Electronics, holding a 23.11% weight in the fund, has risen 186.65%. Together, these two stocks account for roughly 46% of the ETF's total assets and drive more than half of its annual performance.

Valuation and Growth Outlook

Despite the substantial gains, valuations for these memory leaders remain historically low. SK Hynix trades at 6.5 times forward earnings, while Samsung Electronics trades at 5.9 times. Both stocks carry PEG ratios below 0.10, suggesting the market is undervaluing their growth potential relative to expected earnings increases.

Consensus estimates indicate robust revenue growth ahead. Analysts project SK Hynix's forward revenue will rise 237.28% year-over-year, with a two-year revenue CAGR of 123.16%. Samsung Electronics is expected to see forward revenue growth of 97.38% year-over-year and a two-year CAGR of 60.26%.

Comparative Market Performance

The concentration of HBM giants in the South Korean index has allowed it to significantly outperform broader US markets. While memory stocks like Micron Technology Inc., Western Digital Corp., and SanDisk Corp. have posted triple-digit gains in the S&P 500, their lower index weight limits the broader market's impact. In contrast, the heavy weighting of SK Hynix and Samsung in Korean ETFs amplifies the sector's influence.

Over the past 12 months, EWY has gained 208.75%. This performance nearly doubles that of the iShares MSCI Taiwan ETF (EWT), which rose 63.37%, and vastly exceeds the 10.03% return of the SPDR S&P 500 ETF Trust (SPY).