2025 Stock Market Report: KOSPI Rises 75.63%, Tops Global Indexes
Foreign and Institutional Investors Flock to Semiconductor Giants
According to the Korea Exchange on December 31, the KOSPI closed slightly lower at 4,214.17 the previous day, wrapping up the 2025 stock market. Since the beginning of the year, it has surged 75.63%, ranking first in year-to-date returns among major global indices.
What stands out is the return of foreign investors. While foreigners sold off 16.35 trillion won worth of stocks on the main board last month, they became net buyers of about 4.6 trillion won in December, fueling expectations for a "Santa Rally." Institutional investors also added strength, net buying around 5 trillion won this month, following last month's trend.
The stocks most heavily bought by both foreign and institutional investors were semiconductors. This month, foreigners purchased 2.3 trillion won of SK Hynix and 1.1 trillion won of Samsung Electronics, while institutions bought 1.1 trillion won and 1.7 trillion won of each, respectively. Considering that individuals offloaded about 6.5 trillion won worth of Samsung Electronics and SK Hynix shares during the same period, foreign and institutional investors essentially absorbed all individual selling. Thanks to this combined net buying, Samsung Electronics and SK Hynix each set new intraday record highs at 121,200 won and 659,000 won, respectively.
With the return of foreign investors to the domestic market and a concentration of funds in leading stocks, some observers say the conditions are now in place for a "second rally" in the KOSPI. A brokerage firm official noted, "During the sharpest rallies in June, September, and October this year, foreign investors were at the center, with their top picks being SK Hynix or Samsung Electronics. The KOSPI is poised to reach new highs again, but this time, the train may leave individual investors behind." Individual investors' net selling of KOSPI stocks this month reached 9.8 trillion won.
Although individuals are offloading large amounts of Samsung Electronics and SK Hynix shares, the securities industry remains optimistic about the outlook for these two semiconductor giants. This is due to rising general-purpose memory prices and the strengthening of the won-dollar exchange rate, which are boosting expectations for improved earnings.
Noh Geun-chang, Head of Research at Hyundai Motor Securities, said, "The sharp rise in DRAM prices is favorably impacting price negotiations for fifth-generation High Bandwidth Memory (HBM3e), and with HBM4 (sixth-generation) set to be supplied in earnest from the second half of next year, the blended average selling price (ASP) is likely to exceed market expectations." He raised his forecasts for Samsung Electronics' fourth-quarter revenue and operating profit by 1.5% and 18.4%, respectively, to 97.7 trillion won and 19.5 trillion won. The target price was also raised from 129,000 won to 143,000 won.
Ryu Young-ho, a researcher at NH Investment & Securities, stated, "Demand for both DRAM and NAND flash is strong, especially for general servers, and despite overwhelming return on equity (ROE), the stocks remain relatively undervalued." He raised his target price from 860,000 won to 880,000 won, projecting operating profit in 2026 to reach 105.5 trillion won, representing 133% growth compared to this year.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
