KOSPI faces volatility amid Micron earnings and high US yields

The KOSPI index has faced downward pressure, recently closing at 6,838.04 after three consecutive days of decline. While Micron Technology reported strong quarterly earnings that exceeded market expectations—driven by AI data center demand—high US long-term treasury yields near 5% continue to weigh on growth and technology stocks.

Investor behavior in the Korean market has shown significant divergence. Over a recent one-week period, individual investors heavily favored inverse ETFs (known as ‘gobbus’) to bet against market declines. In contrast, foreign and institutional investors focused on leverage products, specifically targeting semiconductor giants like Samsung Electronics and SK Hynix.

However, following a sharp market drop where the KOSPI fell below the 7,000 level, individual investors shifted their strategy, selling inverse products and buying leverage ETFs. Market volatility remains high, influenced by foreign capital flows, the KRW/USD exchange rate, and upcoming US employment data.