South Korea's exports continue to perform strongly, but stock market gains have slowed significantly. A chart released by East Asia Econ on November 12 shows that the year-on-year increase in the Korea Composite Stock Price Index (KOSPI) has fallen from a high of approximately 170% to about 70%, while South Korea's export growth for the first 10 days remains at a high level. This divergence between real exports and stock market performance reflects that stock prices previously overreacted to the investment boom in semiconductors and AI. However, South Korea's export fundamentals remain strongly supported by semiconductor demand, while the stock market is digesting its previous sharp rise, and the gap between market optimism about the industry outlook and stock prices has narrowed.
