World-Beating Stock Rally Creates New Headaches in Korean Market

The words ‘Kospi 4,000’ have been glowing in gaudy yellow text across a giant screen wrapping the Korea Exchange this month, a monument to the spectacular rally that few imagined possible just a year ago. For some investors, it’s also a warning sign.

Up 61% so far in 2025, South Korean stocks are on track to post their strongest gains in a quarter century. Having started the year at around 2,400, the Kospi is the world’s best-performing major benchmark thanks to the AI boom and sweeping corporate reforms.