South Korea’s KOSPI index has undergone a significant correction, falling roughly 40% from its June 22 peak and pushing the market into deeply oversold territory, according to JPMorgan, who deems it as an attractive value.
The investment bank highlights that the KOSPI now trades at around 5 times forward earnings, even after considering cyclical adjustments. Additionally, the market is valued at approximately 5 times estimated free cash flow—levels JPMorgan describes as “crisis-level” valuation. Despite very weak market sentiment, the bank suggests that Korean equities are now trading at historically cheap levels which could provide an appealing opportunity for long-term investors if market fundamentals stabilize.
The Korean stock market has experienced heavy selloffs in recent days. Global investment bank Citibank revealed that Korean retail investors suffered an estimated 56.2 trillion won (about $38.7 billion) in losses through leveraged products during the recent downturn. By underlying asset, SK Hynix leveraged products experienced the largest decline, with market capitalization decreasing by around $17 billion from its peak. Leveraged KOSPI 200 products fell by $10.5 billion, while Samsung Electronics leveraged products dropped by over $5 billion.
Despite declining prices, Citi noted that individual investors have continued purchasing major semiconductor stocks such as SK Hynix, accumulating net purchases of $16 billion since late June 2023. As of July 29, 2026, Citiglobal Markets Securities estimates that these investors have suffered losses of about $5.7 billion, reflecting a current loss rate of over 31%. Losses from Samsung Electronics purchases during the same period are estimated at $2.4 billion.
Citibank analysts note that individual investors have not yet resorted to panic selling and caution that it is premature to adopt an optimistic outlook for the KOSPI. The Korean stock market, while no longer in a “bubble” zone, is seen as remaining between “overvalued” and “fair value” and not yet undervalued.
