Citigroup sees KOSPI hitting 10,000 as 48% rebound play

Citigroup reaffirmed its KOSPI year-end target of 10,000, calling the index's 26% plunge from a June record a buying opportunity.

"We think the recent share price pullback of KOSPI equities, led by KR memory suppliers, is more of a technical correction driven by market-wide profit-taking and therefore could represent a potential buying opportunity," the analysts said in a Monday note.

The KOSPI closed Tuesday at 6,747.95, up 3.56% after a buy-side sidecar was triggered when KOSPI 200 futures rose 5% or more. From that level, Citi's 10,000 target implies a 48% gain — nearly 10% above the previous closing record of 9,114.55 set June 22. The index has lost more than a quarter of its value since that peak, with volatility topping 60% this year — almost double Japan's Nikkei 225 and higher than Bitcoin. The Korea Exchange triggered circuit breakers seven times through mid-July, up from none in all of 2025.

Citi argues that strong economic fundamentals and a market-friendly policy mix can drive the recovery. The bank's analysts told clients the market's headwinds have peaked, betting that the selloff in memory-chip heavyweights Samsung Electronics and SK Hynix was driven by profit-taking rather than a deterioration in fundamentals.

The KOSPI's slide has been defined by a brutal deleveraging cycle. A wave of single-stock leveraged ETFs concentrated retail capital into Samsung Electronics and SK Hynix, which together accounted for 52% of the index's market capitalization before the crash. When regulators flagged concerns about the products on June 22, the index crashed 9.99% the next day, triggering a market-wide trading halt.

Foreign investors pulled a net $12.63 billion from Korean equities in June alone, while retail investors bought 42.4 trillion won on the other side, shifting risk from global institutions to household balance sheets. Margin loan balances peaked at 38.6 trillion won in late June and have since fallen 13% to 33.4 trillion won as of July 16, the lowest since April.

The 10,000 target represents a bet that the deleveraging has run its course and that Korea's export-driven economy will benefit from a recovery in memory-chip demand. Investors will watch whether the KOSPI can hold above the 6,500 level in coming sessions — a breach would test Citi's conviction that the worst is over.

This article is for informational purposes only and does not constitute investment advice.