Despite Government Efforts, KOSDAQ Turns Negative for the Year
Once Up Over 30%, Index Falls Below Zero on June 8
KOSPI Surges 80% While KOSDAQ Stagnates
The exchange rate, KOSPI, and KOSDAQ indices are displayed on the index board in the dealing room of Hana Bank’s headquarters in Jung-gu, Seoul. 2026.06.08 Photo by Dongjoo Yoon
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As the sharp decline in the KOSDAQ market continues, the index’s growth rate, which at one point this year exceeded 30%, has now turned negative.
According to the Korea Exchange, as of 2:29 p.m. on June 8, the KOSDAQ index was trading at 925.93, down 7.63% compared to the previous trading day.
The KOSDAQ started the year at 930 and reached 1,229.42 on April 27, recording its highest growth rate of 32.86% this year, but as of today, it has turned negative.
While the KOSPI index is also experiencing a sharp drop of nearly 7% today, the difference is stark compared to its year-to-date growth rate, which still stands at nearly 80%.
The government has introduced, or decided to introduce, various institutional measures to revive the KOSDAQ market, such as delisting poorly performing listed companies, strengthening disclosure requirements, introducing KOSDAQ active exchange-traded funds (ETFs), and implementing a promotion and relegation system. However, these efforts are widely seen as insufficient to boost the index.
Market participants point to several reasons for the KOSDAQ’s poor performance: the concentration of investments in major semiconductor stocks represented by Samsung Electronics and SK hynix, the KOSDAQ’s composition heavily weighted toward bio stocks with weak earnings, and a market valuation that is considered high compared to the KOSPI.
In particular, as the market has risen this year, mainly led by Samsung Electronics and SK hynix, there is an analysis that individual investors have withdrawn a significant amount of funds from the relatively less attractive KOSDAQ and redirected them to these two leading semiconductor stocks. The recent rise in interest rates has also dealt a heavy blow to bio stocks, which are central to the KOSDAQ.
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Lee Jaewon, a researcher at Yuanta Securities, analyzed, “If the semiconductor rally and the large-cap rally continue, the weak earnings momentum of the KOSDAQ compared to the KOSPI will inevitably lead to continued underperformance for the KOSDAQ.”
This content was produced with the assistance of AI translation services.
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