As South Korea's KOSPI continues to swing sharply, the effects are also reaching the Nikkei Average. Movements in semiconductor exports, exchange rates and memory-market conditions are correlated, and in July 2026, the sharp declines in Samsung Electronics and SK hynix pushed the Nikkei down by around ¥2,400.
KOSPI volatility is closely linked to semiconductor export trends, and its correlation coefficient with South Korean companies' 12-month-forward expected earnings is high at 0.9. The KOSPI is currently moving under the influence of data-center investment and memory prices, and has been noted to tend to react ahead of the global economy.
Foreign investors hold most of the market capitalization, and dollar-denominated performance is closely watched. As the won weakens, realized stock returns decline and selling could become self-reinforcing. In 2026, a reversal was observed in which rising KOSPI share prices coincided with a weaker won.
The Seoul market also has a high degree of correlation with the Nikkei Average, and stocks such as Samsung Electronics, SK hynix and Kioxia often move in the same direction during the same period. Trading hours also overlap, allowing a sharp fall in Seoul to spread to the Nikkei in real time.
In July 2026, the Nikkei Average fell around ¥2,400 the day after Samsung and SK plunged by approximately 10%, with the electric-appliance sector accounting for most of the decline. Volatility in 2026 was high at 63%, exceeding Bitcoin's 48% volatility over the same period.