SK hynix Announces 40 Trillion Won Shareholder Return; KOSPI Surges 5% in Response

SK hynix to Buy Back Treasury Shares by November 19
KOSPI Surges Over 5%, Triggering Buy-Sidecar
Samsung Electronics Also Expected to Return 100 to 200 Trillion Won to Shareholders

On the 20th, the KOSPI index surged more than 4% in the early trading session, triggering the buy-side circuit breaker. The stock market indices were displayed on the electronic board in the dealing room of Hana Bank in Jung-gu, Seoul. As of 9:05 AM, the USD-KRW exchange rate fell 8.7 won from the previous day's closing price to 1,389 won. August 20, 2026. Photo by Jin-Hyung Kang

The KOSPI surged following news of large-scale shareholder returns by SK hynix. With Samsung Electronics also highly likely to announce a shareholder return plan that surpasses that of SK hynix as early as later this month, this is expected to serve as a major catalyst for the stock market.

KOSPI Soars Following SK hynix’s Large-Scale Shareholder Return Announcement

On August 20, the KOSPI opened at 6,680.34, up 3.23% from the previous session, and continued to climb, trading at 6,797.95 as of 10:04 AM, a 5.05% increase. With this sharp rise, a buy-sidecar was triggered around 9:57 AM. The KOSDAQ also traded at 841.00 as of 10:05 AM, up 2.01% from the previous session.

SK hynix boosted the KOSPI after revealing the previous day its plans to acquire and retire 40 trillion won worth of treasury shares. SK hynix announced a shareholder return plan to acquire 24.07 million common shares from today until November 19 and retire them all. It also unveiled a long-term shareholder return policy to return more than 50% of free cash flow (FCF) over the next three years. As a result, as of 10:06 AM, SK hynix stock was trading at 1,676,000 won, up 11.67% from the previous session.

Samsung Electronics is also scheduled to announce its shareholder return policy soon. During its Q2 earnings conference call on July 30, Samsung Electronics stated, "We are actively discussing specific implementation plans for our shareholder return policy, including this year’s special dividend," and added, "We will share the main details with shareholders soon." The market expects Samsung Electronics’ annual shareholder returns to reach up to 200 trillion won. Kim Dongwon, Head of Research Center at KB Securities, estimated that "the new shareholder return policy to be announced by Samsung Electronics soon will be at least ten times larger than the previous policy, totaling between 100 trillion and 200 trillion won."

Due to heightened expectations for shareholder returns, Samsung Electronics was trading at 2,655,000 won as of 10:07 AM, up 7.27%. Most large-cap stocks, such as SK Square (up 6.77%), Hyundai Motor Company (up 1.09%), Samsung Electro-Mechanics (up 0.36%), LG Energy Solution (up 1.40%), and Samsung Biologics (up 1.30%) were also on the rise.

Korean Stock Market’s Further Gains Depend on Stabilization of U.S. Treasury Yields

The overnight rise in the U.S. stock market, driven by the stabilization of U.S. Treasury yields, also had a positive impact on the Korean stock market. On August 19 (local time), the Dow Jones Industrial Average rose 0.22% from the previous session. The Standard & Poor’s (S&P) 500 Index climbed 0.21%, while the tech-heavy Nasdaq Composite Index gained 0.16%.

Risk appetite returned after the U.S. Department of the Treasury announced it would increase the scale of its Treasury buybacks (repurchases). To boost liquidity in long-term bonds, the Treasury decided to double the minimum buyback size per operation from $200 million to $400 million. A Treasury buyback is a system in which the government repurchases existing bonds traded in the market to enhance liquidity for specific maturities and ensure smooth market functioning. As a result, the yield on the U.S. 30-year Treasury bond fell by about 10 basis points (1bp = 0.01 percentage points) during the session, reaching around 5.18%.

In the market, U.S. interest rates are considered a key factor that will determine the future trajectory of the stock market. Kim Byoungyeon, a researcher at NH Investment & Securities, said, "As long-term interest rates, particularly in the United States, continue to stabilize, the relief rally in the stock market should persist. However, while the likelihood is low in the near term, unexpected outcomes may occur if government bond issuance exceeds planned levels due to expanding fiscal deficits, if renewed Middle East risks emerge, or if inflation rises again as tariff-related costs are passed through."

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