Structural Background of KOSPI Rise: US-Iran Peace Agreement and 6 Trillion Won Foreign Inflow

Geopolitical Risk Resolution and KOSPI Upward Momentum

In mid-June 2026, the KOSPI rise has emerged as a central theme in the market. As the military tensions in the Middle East, which lasted for about four months, eased, risk appetite in global capital markets recovered rapidly. According to media reports, the United States and Iran are scheduled to officially sign a memorandum of understanding (MOU) for the end of the war in Geneva, Switzerland, on June 19. This agreement includes key economic sanction relief measures, such as the full opening of the Strait of Hormuz without tolls and the lifting of the US naval blockade.

As the upward pressure on oil prices and the preference for safe assets that had suppressed global stock markets calmed down, an environment for capital inflow into emerging market equities was created. In particular, given the high dependence of the South Korean economy on oil imports, the resolution of Middle East risks acts as a direct positive factor for improving macroeconomic fundamentals, serving as a strong driver for the rebound of the domestic stock market.

Massive Shift to Net Buying by Foreign Investors

The most decisive factor driving this KOSPI rise is the dramatic shift in foreign supply and demand. Foreign investors, who had led the market decline by maintaining a net selling position for 24 consecutive trading days from May to early June, turned to aggressive buying starting June 12, when expectations for the end of the war materialized.

• Net Buying Volume: In just three trading days from June 12 to 16, foreigners net bought approximately 6 trillion won in the KOSPI market (Source: Yonhap Infomax, 2026-06-16).

Index Recovery: Fueled by the concurrent buying spree from foreigners and institutions, the KOSPI index swiftly recovered the 8,700 level, showing strong performance (Source: YTN, 2026-06-16).

Leading Sectors: Buying is concentrated on large-cap sectors such as semiconductors, defense, and shipbuilding, which are expected to benefit from the easing of geopolitical conflicts and the normalization of global supply chains, thereby increasing upward elasticity (Source: Newspim, 2026-06-16).

Future Market Variables and Risk Management

Exchange Rates and Central Bank Policy Directions

Although the current KOSPI rise is accompanied by strong supply and demand, there are still macroeconomic variables that need to be confirmed for it to lead to a trend rally.

The biggest burden is the exchange rate. The KRW-USD exchange rate remains at a high level in the 1,500 won range (Source: Dong-A Ilbo, 2026-06-16). Unless there is a meaningful downward stabilization of the exchange rate, it is difficult to guarantee the continuous inflow of foreign funds. Furthermore, potential friction during detailed follow-up negotiations after the end-of-war agreement, as well as the results of monetary policy decision meetings of major central banks, such as the US Federal Open Market Committee (FOMC) scheduled for this week, could amplify short-term market volatility.

In conclusion, while the resolution of Middle East risks is clearly a favorable catalyst, investors are advised to maintain a selective approach centered on large-cap stocks while monitoring the stabilization of macro indicators.