South Korea’s gross domestic product (GDP) grew 1.0% in the third quarter on chip exports. The Korea Composite Stock Price Index (KOSPI) is still down 8.5% over three months, TradingView data shows.
The Bank of Korea (BOK) reported the gain on Oct. 27, more than triple its 0.3% forecast from August. Samsung Electronics and SK Hynix, which hold about half the index, sit behind both the export boom and the selloff.
Why Is Korea’s Stock Market Falling While Growth Accelerates?
Shipments of semiconductors, machinery and electrical goods lifted exports 2.3%, the Times reported. Facility investment gained 4.1% as companies bought more machinery, chipmaking tools among it.
Private consumption slipped 0.2%, the Herald reported. Exports and factory investment, not households, drove the gain.
Real GDP rose 3.4% from a year earlier, after 3.7% in the second quarter, according to BOK figures. The result extends growth to a third straight quarter.
Is the Market Pricing a Chip Downturn the GDP Data Cannot See?
Goldman Sachs cut its KOSPI target to 9,000 from 12,000 on Oct. 25. Markets, it argues, assume 2027 chip-sector earnings will fall 65%, an outcome the bank calls overly bleak.
October exports hit a record $115.3 billion, with chips accounting for $56.4 billion, or about 49%.
Cumulative exports topped $900 billion for the first time. The trade ministry says $1 trillion could arrive as early as November. Only the US, China and Germany have reached that level.
Can the BOK Keep Tightening Into a Chip Cycle Markets Doubt?
The BOK held its policy rate at 3.00% in October, though the chip boom keeps a November hike in play. Tighter policy would hit an economy where private consumption already fell.
Chips supplied about half of October’s exports. A cooler memory cycle would therefore reach trade, factory spending and the KOSPI at once. The GDP data show the cycle still lifting output, while the index trades as if the lift will fade.
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