South Korea’s Stock Market Surpasses India’s, Becomes Sixth Largest Globally
In a significant development, South Korea’s stock market has officially overtaken India to claim the title of the world’s sixth-largest equity market. Just last week, India was recently surpassed by Taiwan, which then took the fifth spot. This rapid shift has seen India drop from sixth to seventh place within just a week.
The surge in South Korea’s stock market is largely driven by major gains from its leading companies in the semiconductor sector, which are capitalizing on the growing demand for artificial intelligence (AI) technologies. According to Bloomberg’s data, the total market value of South Korean companies has risen by an impressive 86% this year, reaching approximately $5 trillion. Meanwhile, India’s market capitalization has decreased to around $4.8 trillion.
Samsung Electronics and SK Hynix are at the forefront of this growth, both recently achieving valuations exceeding $1 trillion. Their advancements in AI memory-chip technology have significantly boosted the Kospi index, which has seen gains of over 100% this year. Additionally, South Korea has outperformed several other major markets, including Canada, Germany, the UK, and France.
Ross McGarry, a Senior Investment Analyst at Asset Value Investors, remarked on this achievement, noting that South Korea’s rise to match India ranks as a major milestone for a market that previously viewed the Kospi 5,000 level as a distant goal. He pointed out that much of the growth has stemmed from the semiconductor industry, particularly due to contributions from Samsung and SK Hynix. The long-term sustainability of this growth will depend on implementing broader corporate governance improvements.
On the other hand, India’s stock market has faced challenges, including a weakening currency, ongoing foreign investor withdrawals, and a limited number of companies involved in AI-related sectors.
Despite the recent fall in stock market rankings, India continues to maintain a stronger overall economy. The International Monetary Fund estimates that India’s gross domestic product (GDP) is about $4.15 trillion, in stark contrast to South Korea’s $1.93 trillion. India remains one of the fastest-growing major economies worldwide.
Last week, Taiwan’s rise was buoyed primarily by the rapid growth of Taiwan Semiconductor Manufacturing Co. (TSMC), the largest contract chipmaker globally. TSMC now holds approximately 42% of Taiwan’s benchmark index, reflecting the concentration within the market. TSMC shares have surged 46% this year, driven by strong investor interest in AI and the company’s position in semiconductor manufacturing.
This situation underscores how the ongoing AI-driven boom in tech stocks is primarily benefiting regions with a significant footing in advanced chip production, particularly Taiwan and South Korea.
