South Korea's Kospi Index Targets 7500 Points as Chip Sector Drives Rally

JPMorgan’s research team has unveiled a compelling growth outlook for South Korea’s equity market, projecting the Kospi Index could climb to 7500 points by the end of 2026. This ambitious forecast follows the index’s successful breach of the 5,000-point milestone earlier this year, signaling renewed momentum in the region’s financial markets and investor confidence in the nation’s economic trajectory.

Conservative and Optimistic Scenarios

The JPMorgan analysts have established a layered approach to their 2026 projections. For this year’s baseline assessment, they’ve set a conservative estimate of 6,000 points, while their more bullish scenario envisions the benchmark reaching 7500 points by year-end. This dual-target framework reflects the analysts’ confidence in the recovery while acknowledging market uncertainties that could influence performance.

Semiconductor Strength Underpins Growth

The anticipated surge in the Kospi Index is substantially rooted in the semiconductor sector’s robust fundamentals. Rising chip prices have emerged as a powerful tailwind for South Korea’s tech champions. Samsung Electronics and SK Hynix, the nation’s semiconductor pillars, are positioned for exceptional upside, with JPMorgan forecasting potential gains ranging from 45% to 50% through 2026. Beyond these giants, the broader non-memory industrial sector is expected to deliver solid earnings growth, with analysts projecting approximately 20% expansion in earnings per share across this category.

Structural Reforms as Catalysts

Beyond sector-specific dynamics, South Korea’s ongoing policy agenda is expected to provide sustained support for equity valuations. Corporate governance reforms, coupled with comprehensive market restructuring initiatives and favorable tax policy adjustments, are anticipated to function as powerful catalysts for market expansion. These structural improvements reflect the government’s commitment to enhancing the investment climate and supporting long-term economic competitiveness.

The convergence of cyclical strength in semiconductors and structural improvements across governance and policy frameworks positions the Kospi Index for the kind of sustained growth needed to achieve the 7500-point target by 2026.