South Korea's stock market overtakes India to rank 6th globally, driven by AI chips

South Korea's stock market has surpassed India to become the world's sixth-largest by market capitalization, propelled by surging gains at Samsung Electronics and SK Hynix on the back of booming demand for AI memory chips.

As of Sunday, South Korea's equity market capitalization stood at $5.042 trillion, topping India's $4.843 trillion, Bloomberg reported.

South Korea's market cap has jumped 86 percent this year, while India's has contracted roughly 9 percent, triggering the ranking reversal.

Bloomberg said its market cap figures are based on total shares in circulation and exclude exchange-traded funds and American depositary receipts.

Samsung Electronics and SK Hynix have been at the center of the rally. Both companies crossed the $1 trillion market cap threshold this year, fueled by an explosion in demand for high-bandwidth memory chips tied to AI adoption and a broader memory chip supercycle. Their sharp gains lifted the Kospi and drove up the overall value of the market.

South Korea has overtaken Canada, Germany, the United Kingdom and France in succession this year in terms of market size.

The five markets that remain larger than South Korea's are the United States ($79.47 trillion), mainland China ($15.09 trillion), Japan ($8.63 trillion), Hong Kong ($7.24 trillion) and Taiwan ($5.15 trillion).

Ross McGarry, a senior analyst at London-based asset manager Asset Value Investors, said the memory cycle has been driving the rally. He added that the real test is whether South Korea can sustain the rerating through genuine corporate governance reform.

India's market, meanwhile, faces mounting pressure from a weakening rupee, foreign capital outflows and a shortage of tech companies with direct exposure to AI infrastructure.

South Korea's gross domestic product is estimated at $1.93 trillion by the International Monetary Fund, far below India's $4.15 trillion.