KOSPI Drops 23% in July While S&P 500 Rises 2%, South Korean Retail Investors Shift to U.S. Stocks

According to Korea Exchange data released on July 16, South Korea's KOSPI index plummeted 6.37% to 6,820.60, marking a reversal after a 6.24% surge the previous day. Over the same one-month period, the KOSPI has fallen 23%, while the S&P 500 rose 2%, prompting domestic retail investors to redirect capital overseas.

According to the Korea Securities Depository, domestic individual investors' net purchases of U.S. stocks reached $979.35 million through July 15, a 55% surge compared to the prior month. Overseas equity ETF purchases totaled 1.37 trillion won, nearly double the 691.4 billion won in domestic equity ETF purchases. Major U.S.-focused ETF purchases included TIGER S&P 500 ($161.1 million), KODEX Nasdaq-100 ($98.6 million), and Direxion Semiconductor Bull 3x ($116.3 million).