South Korea’s stock market overtook Canada’s on Wednesday to become the world’s seventh-largest by market capitalization, according to Bloomberg data, capping a year in which the AI-fueled rally in Korean semiconductor stocks has rewritten the global equity rankings.
A Milestone Built on Chips
The Kospi surged 6.5% on Wednesday to bring its year-to-date gain to roughly 75%, its eighth daily advance of more than 5% in 2026. The session also saw Samsung Electronics close above a $1 trillion market capitalization for the first time, making it only the second Asian company after Taiwan’s TSMC to reach that threshold. SK Hynix rallied more than 10% on the day; both chipmakers have more than doubled this year.
Bloomberg reported that South Korea’s total market capitalization has surged more than 45% this year, having already passed the United Kingdom in late April when it reached $4.04 trillion. The continued rally through early May pushed it past Canada. Overseas investors purchased more than $2 billion of Kospi shares on Wednesday alone, just below the record set in October.
AI Demand Drives the Surge
The Korean rally reflects a global reallocation toward companies supplying the infrastructure behind artificial intelligence. Samsung reported a 750% increase in operating profit in the first quarter, reaching a record high, while SK Hynix has benefited from its dominance in high-bandwidth memory chips used in AI data centers. U.S. tech giants including Alphabet signaled combined AI capital expenditure would surpass $700 billion this year, up from around $600 billion previously projected.
The gains represent a sharp reversal of what investors long called the “Korea discount,” a persistent undervaluation of Korean equities relative to global peers. The Kospi has nearly tripled since early 2025.
Opening the Door to Foreign Capital
The rally has coincided with regulatory moves to attract global investors. In January, South Korea’s Financial Services Commission announced it would allow overseas brokerages, including Interactive Brokers, to open Korean securities trading accounts, with access to real-time Korean won exchange rates set to begin in July 2026. Interactive Brokers has since activated direct trading on the Korea Exchange for its clients, becoming the first major U.S.-based broker to offer seamless access to KRX-listed equities.
South Korea now trails only the United States, China, Japan, India, France, and Taiwan in total equity market value, according to Bloomberg.
