KOSPI-Nasdaq 100 Correlation Hits Highest Since July 2024
The 60-day correlation between the KOSPI and Nasdaq 100 has risen to +0.46, the highest since July 2024, reversing from a negative correlation of -0.20 in March. The Nasdaq 100's sensitivity to South Korean stock declines is at its highest since 1990.
The 60-day correlation between South Korea's KOSPI and the Nasdaq 100 index has reached +0.46, the highest level since July 2024. This marks a sharp reversal from the negative correlation of -0.20 recorded in March.
For context, the 5-year average correlation is just +0.16, meaning the current reading is nearly three times higher. Furthermore, the Nasdaq 100's sensitivity to declines in South Korean equities has surged to its highest level since 1990. At the same time, the MSCI World Index's sensitivity to the South Korean market is at a 4-year peak.
These figures suggest that declines in South Korean stocks are increasingly serving as an early indicator for US and global equity risk appetite, particularly in technology. As the author notes, the AI trade has never been more global.
Source: The Kobeissi Letter