Key facts
- South Korean stocks rebounded nearly 6 percent on Friday.
- The KOSPI index gained 5.76 percent.
- Samsung Electronics and SK hynix led the recovery in South Korea.
- KRX activated a buy-side sidecar for the KOSPI index due to a sharp rise.
- Program trading was suspended for five minutes after the KOSPI index rose over 5%.
- Europe's STOXX 600 index reached a record high.
- Germany's DAX also hit an all-time high.
- Global equity funds saw inflows increase to $10.44 billion in the week to July 1.
- Investors showed strong demand for technology stocks.
- Hedge funds achieved strong double-digit returns for the year.
- June saw losses in oil and certain tech stocks for hedge funds.
- Short positions in fixed income detracted from hedge fund performance.
Global stock markets showed strong upward momentum, with South Korea's KOSPI index jumping 5.76% on Friday, fueled by bargain hunting in semiconductor shares. This significant rebound led the KRX, South Korea's bourse operator, to activate a buy-side sidecar for the KOSPI index, temporarily suspending program trading for five minutes after the index rose over 5%. Major chipmakers like Samsung Electronics and SK hynix were at the forefront of this recovery.
In Europe, the benchmark STOXX 600 index reached an all-time high, positioning itself for its best weekly performance in over a month. This surge was attributed to strong performance in cyclical stocks and a shift in expectations regarding U.S. interest rate hikes. Germany's DAX also achieved a record high, reflecting the broader positive sentiment across European markets.
Investor sentiment globally was further bolstered by signs of economic expansion in Asia, contributing to a strong week for global equities, potentially the best since early May. U.S. jobs data released during the week cooled expectations of further Federal Reserve rate hikes, adding to the optimistic outlook. Despite recent dips in the MSCI World Index and some AI-related setbacks, global equity funds attracted substantial inflows of $10.44 billion in the week ending July 1, with technology stocks being a particular focus for investors betting on continued earnings growth.
Hedge funds also reported positive performance, achieving strong double-digit returns for the year, largely due to successful navigation of crowded trades and effective fundamental analysis. However, the volatile market conditions in June presented challenges, leading to losses in oil and certain technology stocks. Additionally, short positions in fixed income detracted from overall hedge fund performance during that month.