Despite Ceasefire Hopes and Semiconductor Momentum... Variables Shaking the KOSPI [Good Morning Market]

Micron Joins the '1 Trillion Dollar' Club as Semiconductor Rally Continues
Leveraged ETFs for Samsung Electronics and SK hynix Expected to Drive Volatility

The domestic stock market is expected to open higher, buoyed by the strength of U.S. semiconductor stocks. However, there are forecasts of increased volatility due to the listing of single-stock leveraged exchange-traded funds (ETFs) for Samsung Electronics and SK hynix.

On the 22nd, the KOSPI index opened at 7,873.12, up 57.53 points from the previous trading day, with the domestic stock market status displayed on the electronic board in the dealing room at the Hana Bank headquarters in Jung-gu, Seoul. On the same day, the KOSDAQ index rose more than 5% intraday, triggering a buy-sidecar for two consecutive days. Photo by Jin-Hyung Kang, May 22, 2026.

On May 26 (local time), the U.S. stock market saw the large-cap S&P 500 index close at 7,519.12, up 45.65 points (0.61%) from the previous trading day, while the technology-focused Nasdaq index set a new record high, finishing at 26,656.18, up 312.21 points (1.19%). The Dow Jones Industrial Average closed at 50,461.68, down 118.02 points (0.23%) compared to the previous session.

In the U.S. stock market, expectations for an end to hostilities between the United States and Iran are rising. As the possibility of a 60-day ceasefire agreement between the two countries is being discussed, repeated frictions and progress in negotiations have raised investors' thresholds for reacting to war-related risks.

The dominance of semiconductor stocks is also helping to absorb external shocks such as war. On that day, Micron surged nearly 20% from the previous day, pushing its market capitalization past the 1 trillion dollar (1,500 trillion won) mark. Global investment bank UBS also raised its price target for Micron by about 200%, from $535 to $1,625, citing a strengthening memory cycle.

On this day, the domestic stock market is expected to open higher due to the strength of U.S. semiconductor stocks, but volatility is likely to follow. The previous day, the KOSPI index closed above the 8,000-point level for the first time in history, and the earnings-driven market is continuing. However, the introduction of single-stock leveraged ETFs for Samsung Electronics and SK hynix scheduled for today could become a catalyst for heightened volatility.

Leveraged ETFs can bring new liquidity to the domestic stock market. As of May 21, the total number of applicants and graduates for leveraged ETF investment training amounted to about 200,000 people. In addition, there are expectations for an inflow of investors from leveraged ETFs listed overseas. As a result, the market could experience even greater volatility.

Even without leveraged ETFs, index volatility in the domestic market has already increased. The VKOSPI, the volatility index for the KOSPI 200, has averaged in the 68-point range this month, far exceeding both the annual average at the beginning of the year (52 points) and the post-2010 average (20 points).

Of course, the impact of leveraged ETFs may not be significant. The combined market capitalization of Samsung Electronics and SK hynix is 3,100 trillion won, while the estimated net assets of leveraged ETFs are only about 4 trillion won. In addition to directional bets, there could also be demand for hedging using inverse leveraged products. However, as Samsung Electronics and SK hynix are market leaders, if capital becomes concentrated in leveraged ETFs, the volatility of the underlying assets is bound to increase.

Han Ji-young, a researcher at Kiwoom Securities, said, "It is important to keep in mind that reacting to market volatility caused by leveraged ETFs with frequent trading may not be the best strategy."

This content was produced with the assistance of AI translation services.