KOSPI Nears 7,000-Point Threshold... Sustained Gains Depend on This

Further KOSPI Gains Depend on U.S. Treasury Yield Stabilization
SK hynix and Samsung Electronics Maintain Shareholder Return Expectations

On the 21st, employees are monitoring the stock market and exchange rates in the dealing room at the Hana Bank headquarters in Jung-gu, Seoul. On this day, the KOSPI opened at 6,759.95, down 92.63 points (1.35%) from the previous trading day, and the KOSDAQ opened at 824.05, down 16.84 points (2.00%), continuing a slightly weak trend, while the USD/KRW exchange rate is trading in the 1,380 won range. August 21, 2026, Photo by Jo Yongjun

While U.S. Treasury yields rebounded and led to a decline in the U.S. stock market, the KOSPI is showing a slightly weak trend, supported by market expectations for large-scale shareholder returns from Samsung Electronics and SK hynix. According to securities analysts, stabilizing market interest rates is considered the highest priority for the KOSPI to firmly establish itself above the 7,000-point threshold.

SK hynix and Samsung Electronics Maintain Shareholder Return Expectations

On August 21, the KOSPI opened at 6,759.95, down 1.35% from the previous trading day, but soon trimmed its losses and, as of 10:00 a.m., was trading down only 0.23% at 6,836.97. The KOSDAQ began the session at 824.05, down 2.00%, and declined further to trade at 803.21, down 4.48%.

At 10:02 a.m., SK hynix, which announced a 40 trillion KRW shareholder return policy on August 19, was trading at 1,754,000 KRW, up 3.73% from the previous day. Samsung Electronics, also ahead of its shareholder return announcement, was trading up 0.55% at 272,500 KRW. However, most of the other major blue-chip stocks were trending downward, including SK Square (-1.25%), Samsung Electro-Mechanics (-5.30%), Hyundai Motor Company (-1.68%), and LG Energy Solution (-3.35%).

Overnight, U.S. stock indices all closed lower, prompting a lower opening for the Korean market as well. The Dow Jones Industrial Average fell 1.32% from the previous session, the S&P 500 dropped 0.87%, and the NASDAQ declined by 1.00%. Although the U.S. Treasury Department’s previous day announcement to expand the size of long-term Treasury buybacks initially calmed interest rates, yields reversed upward the very next day, putting renewed pressure on equities. The 30-year U.S. Treasury yield rose about 4 basis points (1bp = 0.01 percentage point) to 5.24%, and the 10-year Treasury yield climbed 5 basis points to 4.70%.

Suh Sangduk, a researcher at Mirae Asset Securities, pointed out, "The Treasury's buyback is not a fundamental solution to rising interest rates. Even though they said they could expand buybacks beyond 40 trillion dollars per issue, it will be difficult to continuously lower yields unless a concrete fiscal consolidation plan is put in place."

Further KOSPI Gains Depend on U.S. Treasury Yield Stabilization

Experts highlight that stabilization of U.S. Treasury yields is the most important factor influencing the future direction of equity markets. In particular, unless bond yields, which have surged to around 5%, stabilize, it will likely be difficult for the equity market to maintain a sustained rally.

KB Securities analyzed that if the yield on the 10-year U.S. Treasury surpasses 5.0%, capital providers such as financial institutions and venture capital may start withdrawing their investments in artificial intelligence (AI), which could lead to increased shock across global stock markets. Lee Euntaek, executive director at KB Securities, explained, "Capital providers typically respond to rising interest rates before reacting to economic slowdowns. If they can achieve high returns from government bonds alone, their incentive to take on greater risk by funding AI companies diminishes."

Other short-term influences on the market include the anticipated announcement later this month of Samsung Electronics’ sizable shareholder return plan and Nvidia’s second quarter earnings announcement for its fiscal year on August 27 (Korean time). According to industry sources, Samsung Electronics is reportedly preparing a shareholder return policy valued between 100 trillion to 150 trillion KRW, far exceeding the 40 trillion KRW stock buyback and cancellation plan unveiled by SK hynix on August 19.

Nvidia is again expected to deliver strong results. Market consensus estimates that Nvidia’s second quarter revenue will reach 91.9 billion dollars, with earnings per share (EPS) of 2.08 dollars—both of which would set new records. Lee Kyungmin, a researcher at Daishin Securities, commented, "Nvidia’s results announcement next week will be a turning point for AI-related investment sentiment. Strong earnings and positive guidance from Nvidia could serve as a trigger for improved sentiment in both AI and semiconductor investments, and for a second phase of market rebound." He added, "However, continued external uncertainties could limit the momentum of any upside, even with improved earnings."

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