South Korea’s benchmark KOSPI opened higher on Tuesday, led by gains in chip stocks. As of 9:15 a.m., the index was up 2.39% at 7,144.85. Samsung Electronics rose 3.64% and SK hynix gained 6.38%. The tech-led advance came even after a drop in U.S. stocks overnight and as Middle East concerns kept oil prices high, adding to inflation worries.

South Korea’s CJ Group said it is targeting North America revenue of 12 trillion won ($8.48 billion) by 2028. The conglomerate plans to link its food, entertainment and beauty businesses to capitalize on rising demand for Korean culture and products. CJ said it generated more than 8 trillion won in North America revenue last year, up more than tenfold from 2017, and has made cumulative investment of 9.7 trillion won in the region. A CJ survey found about 30% of U.S. respondents expressed interest in Korean cultural products.

South Korea’s KOSPI has seen record-level volatility, leaving investor sentiment split between euphoria and anxiety. Foreign investors bought more than 7 trillion won of shares in a week, even as securities-firm client cash fell by more than 32 trillion won over two months and bank deposits rose by more than 24 trillion won in a month, suggesting a shift back toward lower-risk assets. Forced liquidations triggered by a sharp market drop reached 61.1 billion won on Wednesday, more than quadrupling and highlighting the fragility of leveraged bets.

The Korea Exchange (KRX) triggered a sell-side sidecar on Wednesday at around 10:55 a.m., halting program trading in KOSPI-listed shares for five minutes. The move was prompted after the KOSPI 200 Futures Index fell more than 5% for at least one minute. The KOSPI was down more than 4.5% on the day. Retail investors sold large-cap stocks including SK hynix amid concerns that heavy artificial intelligence spending may not support elevated valuations.

Major South Korean carmakers are facing the threat of large-scale union strikes after wage talks stalled. Unions are seeking higher pay, bigger performance bonuses and an extension of the retirement age, after earlier walkouts caused production losses estimated at about 670 billion won. With second-quarter earnings already pressured by softer global demand and lingering U.S. tariff burdens, the risk of further disruption is adding to uncertainty and weighing on sentiment toward traditional assets tied to the sector.

South Korea’s KOSPI fell 6.41% to 6,322.80 in early trading on Tuesday, prompting the exchange to trigger a 20-minute sellside sidecar. Losses followed a 2.2% drop in the PHLX chip index overnight, which weighed on Seoul tech shares, with Samsung Electronics down 7.68% and SK hynix off 9.36%. Hyundai Motor and LG Energy Solution also declined. While easing Middle East tensions were cited, they did little to calm concerns over the durability of heavy AI capital spending.

Hyundai Motor Group’s push into physical artificial intelligence has yet to ease investor concerns as weaker automotive earnings prompt brokerages to cut target prices for Hyundai Motor and Kia. Hyundai Motor’s second-quarter operating profit fell 20.8% to 2.85 trillion won and global vehicle sales declined 6.9%, while Kia’s operating profit slipped 4.9% to 2.63 trillion won. Hyundai Motor shares have dropped more than 20% over the past three months and Kia has fallen more than 10% over the same period. Analysts say the strategy has not translated into improved earnings or stronger valuation support.

Korean retail investors have been paying up for SK hynix American depositary receipts in New York, pushing the ADRs to a 16%–51% premium over the chipmaker’s Seoul-listed shares since trading began on Nasdaq about two weeks ago. The gap has widened even as the Korean stock has fallen from a June 25 record of 2,987,000 won to the 1,700,000-won range, while the ADRs climbed as high as $193.92. Net buying by Korean investors reached $675.5 million, their second-largest overseas securities purchase over the past month, according to SEIBro. Analysts say short-term trading preferences—despite less favorable tax treatment and limits on conversions—have helped sustain the premium and higher volatility.

Hyundai Motor said its operating profit fell 20.8% year on year in 2024 Q2 to 2.85 trillion won ($1.94 billion), while revenue rose 1.9% to 49.2 trillion won. The decline was driven by softer global vehicle demand and supply-chain disruptions after a March fire at a key auto parts supplier, which constrained output during the quarter. The company said it expects earnings to recover in the second half, helped by launches including the facelifted Grandeur, redesigned Elantra and Tucson, and the IONIQ 3 in Europe.