The most severe phase of South Korea's stock-market turmoil may have passed after forced liquidations reduced leveraged positions and tighter regulations curbed trading in high-risk products, Bloomberg reported. A volatility index for Korean equities fell to a two-month low last week after reaching a record in June, and Morgan Stanley estimated that the market's deleveraging process is now more than halfway complete. The Kospi Index had fallen nearly 40% from its June peak, with the volatility gauge surging to 96.9 in June from 28.9 at the end of 2025. Regulators increased cash deposit requirements for single-stock leveraged exchange-traded funds from July 31, leading to lower trading volumes and assets in leveraged products linked to Samsung Electronics and SK Hynix. Forced liquidations affected about 1 trillion won of retail accounts in June and another 993 billion won in July, while outstanding margin loans declined to 27.4 trillion won on August 4, their lowest level this year. Foreign investors withdrew a record $30 billion in June, followed by $6.2 billion in July and $4.3 billion during the first part of August, though Goldman Sachs maintained its 12-month Kospi target of 12,000, implying roughly 90% upside from Friday's close.
SK Hynix Inc
Hyundai Motor Co. Ltd.
Samsung Electronics Co Ltd
KB Financial Group