Goldman Sachs: Retail Fund Flows to Crypto Impact KOSPI Index Support

Goldman Sachs analyst Chris Cha noted in a report on September 23 that the KOSPI index has the conditions for a short-term "tactical breakout," but the continuous liquidity flow from Korean retail investors to the crypto market means that the index's subsequent upward movement will rely more on foreign and local institutional reallocation. The report mentioned that concerns over Federal Reserve interest rates have been partially digested by the market, with risk appetite shifting towards the "proxy AI" theme. Korean memory chips will provide fundamental support, with expectations for a double-digit quarter-on-quarter increase in DRAM contract prices in the fourth quarter, while the ramp-up of HBM4 capacity will limit the supply of standard server DRAM. Samsung Electronics' substantial shareholder returns, continuous buying by institutions, and foreign investment turning into net buying may drive the KOSPI to challenge the resistance zone of 7000 to 7200 points. However, the report also cautioned that the absorption capacity of local retail investors in Korea has weakened. After Bitcoin returned to $85,000, crypto trading in Korea quickly heated up. Data from DefiLlama shows that Upbit's single-day spot trading volume on June 13 was approximately $770 million, which rose to $1.817 billion on September 22, an increase of about 136%. Based on the total trading volume of $3.27 billion from Korea's top five trading platforms on September 22, Upbit alone accounted for over half of the trading volume, reflecting that local risk capital in Korea is flowing back into digital assets. Goldman Sachs believes this will make the future trend of the KOSPI more dependent on foreign and institutional buying, with October being a critical window to test whether foreign investors are willing to continue increasing their positions in Korean semiconductor and AI assets.