[Dongchun Weekly] May Week 4 — KOSPI Hits Record 7,847 on Institutional Rescue, US Yields Pin Down Nasdaq

Hey, Dongchun here.

Here is the Korean stock market weekly recap for the week ending May 24, 2026 — KOSPI, KOSDAQ, foreign investor flow, sector moves, and what is on deck for next week.

DONGCHUN'S TAKE

The single thing that mattered this week was that institutions net-bought 2.30 trillion won in one day to drive the KOSPI up 8.42% to a record 7,847.71 close, even as foreigners extended a 9-day, 35-trillion-won selling streak. US markets diverged sharply, with the Nasdaq finishing -1.29% on the week as the 30-year yield briefly hit 5.19% and Nvidia slid post-earnings despite a flawless beat. Next week's binary events are Monday's US Memorial Day closure and Thursday's PCE deflator print.

KOSPI and Korean Markets: The Week in Numbers

This week was decisively risk-off in the US and Korea-specific risk-on in Seoul, with US long-end yields and a Nvidia sell-the-news reaction as the single biggest drivers. The week's tone was mixed rather than a clean trend.

US index breadth was uneven. Small caps (Russell -0.68%) trailed the Dow (+0.45%) for most of the week, but Friday saw Russell +0.93% outpace Nasdaq +0.09%, signaling a tentative breadth rebuild rather than a sustained large-cap squeeze. The Nasdaq's -1.29% weekly loss reflects yield pressure on growth duration.

Korea outperformed sharply but on a single-day spike. KOSPI gained 4.74% on the week and KOSDAQ +2.77%, almost entirely on Thursday's +8.42% and Friday's +4.99% KOSDAQ biotech burst. EWY closed at $182.03 (Friday -2.35%), reflecting USD/KRW volatility above 1,500 even as the underlying KOSPI ripped.

The macro variable that mattered most was the long end of the Treasury curve. The 10Y peaked at 4.67% mid-week before retracing to 4.59%, while WTI cratered 4.77% on Iran de-escalation hopes. Heading into next week, Thursday's PCE deflator is the binary event.

Index	Week Open	Week Close	Weekly %	Note
S&P 500	7,501.50	7,445.72	-0.74%	3-day losing streak then recovery
Nasdaq	26,635.50	26,293.10	-1.29%	Sell-the-news cap on AI rally
Dow Jones	50,061.60	50,285.66	+0.45%	Defensives held 50K line
Russell 2000	2,863.00	2,843.45	-0.68%	Yield pressure on small caps
KOSPI	7,492.79	7,847.71	+4.74%	Single-day +8.42% rescue
KOSDAQ	1,129.84	1,161.13	+2.77%	Friday biotech +4.99%

Indicator	Start of Week	End of Week	Weekly Change	Market Read
US 10Y Yield	4.59%	4.59%	flat (intraweek high 4.67%)	Duration risk remains
DXY	99.21	99.19	-0.02	Directionless
VIX (weekly high)	19.25 (Mon)	16.76	-13%	No panic, calm zone
EWY	—	$182.03	-2.35% (Friday)	FX volatility weighed

3 Korean Stock Market Themes This Week

Theme 1: Nvidia's Flawless Beat Met Sell-the-News

On May 20 after the US close, Nvidia reported Q1 FY27 revenue of $81.6B (+85% YoY) and EPS $1.87, both beating consensus, with Q2 guidance of $91B well above the $86.84B Street estimate. The regular session into the print had been a blowout — SOX +4.49%, SMCI +9.49%, AMD +8.1% — yet the stock slid after hours.

The Korea read-through was sharply asymmetric. KOSPI fell 3.25% the next session on sell-the-news anxiety, then surged 8.42% one day later with SK Hynix +11.17% and Samsung Electronics +8.51% as the memory thesis reclaimed leadership. The reaction, not the headline number, defined the week.

This theme carries directly into next week as the AI rally's durability remains under question.

Theme 2: Institutions Single-Handedly Reversed a 35 Trillion Won Foreign Exit

Foreign investors extended a 9-day net selling streak on the KOSPI dating to May 7, with cumulative outflows topping 35 trillion won. Tuesday alone saw -4.8 trillion won and Wednesday added another 2+ trillion. USD/KRW briefly broke above 1,508–1,515 as the FX feedback loop accelerated the exit.

Institutions then bought 2.30 trillion won in a single day on May 21, overpowering both foreign and retail selling to lift the KOSPI 8.42%. Domestic-return (RIA) flows out of US big tech into Samsung and SK Hynix added fuel. Friday's +0.41% follow-through was modest, leaving the durability question open into next week — the institutional bid must repeat or extend for the move to stick.

Theme 3: Long-End Treasury Yields Hit One-Year Highs

On May 20, the 30-year US Treasury yield briefly hit 5.19%, its highest in nearly 19 years, while the 10-year reached 4.67%, the highest since January 2025. The driver was the disappearance of any 2026 rate-cut expectations, with some desks even modeling an outright hike. PPI/CPI stickiness pushed bond demand to a new low.

The Korea read-through was direct. NAVER and Kakao both fell 3%+ mid-week on duration pressure, LG Energy Solution lagged the rebound, and broker stocks crashed Wednesday on rate sensitivity. Heading into next week, Thursday's PCE deflator is the single binary catalyst that decides whether yields anchor in the 4.6% zone or test back toward 4.5%.

Weekend Catch-up: Korean Market News

Iran negotiation friction resurfaced over the weekend. Secretary Rubio said there were "good signs" of progress but cautioned any deal becomes unworkable if Tehran insists on permanently controlling Strait of Hormuz transit, with enriched-uranium stockpile rules also unresolved. Sunday-night oil futures bounced back into the $103 zone for Brent, suggesting energy and defense names could gap higher Tuesday in the US after Monday's holiday.

WTI tried to reclaim the $100 line late Friday and into the weekend. Brent rose roughly +1% in overnight trade, partially reversing the week's 4.77% slide. For Korea, refiner and shipbuilding names face mild upside gap risk Monday, though follow-through is likely limited given the broader peace-talk trajectory.

US Memorial Day on May 25 closes both stock and bond markets. Korea trades normally, but the absence of US futures liquidity could amplify FX volatility, and foreign flow signals will be the cleanest read of Monday's tape. Friday's Korean close is the most likely template for Monday's open.

In crypto, Bitcoin held the $76,000 line for the third consecutive week despite roughly $980M of ETF outflows. The market closed Friday near $77,350. Korea and Japan exchange action Monday morning is the first directional read for the new week.

Korean Sectors and Foreign Investor Flow

The strongest US sector this week was semiconductors on a single-day basis. SOX rallied 4.49% Thursday into Nvidia's print, even though the weekly path was choppy with -4.02% Monday and -2.47% Tuesday before the rebound. The translation to Korea was concentrated in Samsung Electronics (005930) +8.51% and SK Hynix (000660) +11.17% on Thursday's session, both lifted by HBM demand expectations.

The weakest US area was rate-sensitive small caps and energy, with Russell 2000 -0.68% and WTI -4.77% on the week as long-end yields surged and Trump shelved Iran strikes. The Korean read-through was an internet/duration hit — NAVER (035420) and Kakao (035720) sold off mid-week, and Korean broker stocks crashed Wednesday on rate sensitivity.

Foreign flow in Korea was sharply net sell — nine consecutive days of outflows and roughly 35 trillion won cumulatively since May 7 — but institutions absorbed it. Institution net buys concentrated on Samsung Electronics, SK Hynix and Hyundai Motor. Biotech is the Korean sector with the most follow-through potential next week, with ASCO 2026 running May 29 to June 2 and KOSDAQ biotech already up 4.99% on Friday alone.

Sector	US Weekly	Direction	Korea Linked	Korea Weekly	Watch Stock
Semiconductors	SOX volatile, ~flat	▬	Samsung (005930), SK Hynix (000660)	Strong on Thursday spike	SK Hynix (000660)
Big Tech / AI	Nasdaq -1.29%	▼	NAVER (035420), Kakao (035720)	Mixed	NAVER (035420)
Energy	WTI -4.77%	▼	S-Oil (010950), GS Holdings (078930)	Weak	S-Oil (010950)
Financials	Dow +0.45%	▲	KB (105560), Shinhan (055550)	Mixed, brokers weak	KB (105560)
EV / Battery	Mixed	▼	LG Energy (373220), Samsung SDI (006400)	Lagged	LG Energy (373220)

Kimchi Premium and Crypto in Korea

Bitcoin's weekly path was a slow grind lower then a stabilization. The week opened near $80,560, dropped to a $76,300 low on May 19 as risk-off carried into crypto, and recovered to roughly $77,350 by Friday's close. The week's -4% move was tempered by the third consecutive successful test of $76,000, while spot Bitcoin ETFs saw approximately $982M of weekly outflows.

Ethereum underperformed Bitcoin meaningfully. ETH closed near $2,128 on May 20 after falling 7.55% on the week, holding the $2,100 line just barely. The ETH/BTC ratio slipped further as the bid concentrated in BTC and selective alts.

Solana traded at $83.89 on May 23, down roughly 9% from the prior week's $92 high after leading the prior week, marking a clear sentiment shift to risk-off in majors.

Kimchi Premium sat in a 0.8–1.0% range on Upbit as of May 23, 2026 KST. The local premium has settled in this narrow band after spiking to 1.98% in early May, signaling neither aggressive Korean retail demand nor selling pressure. Regulatory tightening on Korean exchanges has compressed the premium's range structurally versus its 2024 peaks.

Fear & Greed Index sat at 35 (Fear) on May 23, down from 65 (Greed) one week earlier — a 30-point compression in seven days. Total crypto market cap stood at approximately $2.59–2.81 trillion, down 2–3% on the week, with BTC dominance holding around 58.0%. The signal into next week is neutral-to-cautious: a $76K break would unlock further downside, while a reclaim of $80K shifts the tape back to risk-on.

Coin	Week Open	Week Close	Weekly %	Key Driver
BTC	$80,560	$77,350	~-4%	$76K third weekly hold, ETF outflows
ETH	~$2,260	$2,108–$2,128	~-7.5%	Fourth consecutive losing week
SOL	$92.20	$83.89	~-9%	Profit-taking after prior +13% week

Kimchi Premium: ~0.8–1.0% as of 2026-05-23 KST Fear & Greed: 35 — Fear

This Week's KOSPI Prediction Scorecard

This week's prediction accuracy was directionally solid but consistently miscalibrated on magnitude. Roughly four of nine major directional calls landed, with two clear misses on Wednesday's macro-friendly setup that nonetheless saw KOSPI -3.25%, and on Friday's "foreign buying" thesis that the institutions wrote on their own.

The single best call was Tuesday PM's bear-case scenario — predicting a 7,150 retest with foreigners extending the selling streak and chip support breaking. KOSPI closed at 7,271.66 after touching 7,141.91 intraday, with SK Hynix -5.16% confirming the chip-only buying breakdown almost exactly as called.

The biggest miss was Wednesday PM's expectation that a Nvidia beat plus a sub-1,500 won would lift KOSPI toward 7,300. The Nvidia beat materialized cleanly, the won broke 1,496, yet KOSPI fell 3.25% on a sell-the-news transmission no scenario tree weighted highly enough. Next week's lesson: post-earnings reactions, not numbers, set Asia's tape.

Day	Post	Key Prediction	Actual Result	Verdict
Mon	PM	KOSPI 7,500 hold, gap-down risk from SOX	Held 7,516, SOX -4.02% as warned	✅
Tue	AM	Chip-only foreign buying continues	Pattern broke, SK Hynix -5.16%	❌
Tue	PM	7,250–7,350 range, 7,150 retest risk	Closed 7,271, intraday low 7,141	✅
Wed	AM	Won <1,490 needed for 7,600 retest	Won 1,492, KOSPI to 7,516 only	△
Wed	PM	Nvidia beat + FX = 7,300 recovery	Nvidia beat, KOSPI -3.25%	❌
Thu	AM	Sell-the-news transmission risk	KOSPI -3.25% confirmed transmission	✅
Thu	PM	Institutional rally durability doubted	Friday only +0.41%, durability still open	△
Fri	AM	Foreign buy needed for 7,300 break	KOSPI hit 7,847, foreigners still sold	△
Fri	PM	Chip vs biotech leadership next test	TBD next week	TBD

Next Week's Korean Stock Market Playbook

The single most important variable to watch next week is Thursday's PCE deflator print. Core PCE is the Fed's preferred inflation gauge, and the long-end Treasury rate's 4.6%+ anchor depends entirely on whether this print reinforces sticky-inflation fears or breaks them. Memorial Day on Monday means the first half of the week is liquidity-thin; the PCE release on Thursday concentrates the macro signal into a single 8:30 AM ET window.

The US market direction call is cautious. The Nasdaq's -1.29% weekly loss combined with the 10Y still near 4.6% and the sell-the-news Nvidia reaction limit the case for a sustained rally; small-cap participation Friday is a positive but isolated signal. KOSPI's call is neutral with upside skew on institutional flow.

Bull condition: KOSPI breaks 7,900 on continued institutional buying plus a USD/KRW sub-1,500 close. Bear condition: KOSPI loses 7,700 on USD/KRW above 1,510 with foreign selling accelerating.

The Monday open's leading indicator is foreign net flow on Samsung Electronics in the first 30 minutes — with US futures shut for Memorial Day, this metric becomes the cleanest standalone signal. The underappreciated risk is ASCO 2026 biotech data disappointment — the KOSDAQ's Friday +4.99% surge could unwind quickly if abstract presentations underwhelm. The underappreciated opportunity is the institutional bid in memory: if it repeats Monday or Tuesday, SK Hynix and Samsung Electronics retest record highs as foreigners get squeezed back in.

Date	Event	Consensus / Expected	Market Impact
May 25 (Mon)	US Memorial Day Holiday	US stock/bond markets closed	Korea solo, FX volatility risk
May 28 (Thu)	US Core PCE Deflator	At consensus	Above consensus reignites yield surge
May 28 (Thu)	US Q1 GDP 2nd estimate	At consensus	Beat anchors Dow above 50K
May 28 (Thu)	US April Durable Goods	At consensus	Capital goods read for industrials
May 29 (Fri)	ASCO 2026 opens (through Jun 2)	Korean biotech in focus	Altheogen, ABL Bio in scope

DONGCHUN'S WRAP

Foreigners walked out with 35 trillion won and the institutions caught the falling knife with both hands — Korea ended the week at a record, but the question of whether that bid is real or one-off lands on Monday's tape with US markets dark.

출처

So — what shape is next week taking?

That's the weekly wrap for 2026-05-24. Trade safe.

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