Taiwan and Korea Lead Global Stock Market Rally in 2026, Despite Variance Among Key Stocks

Asian Markets on a Tear: Taiwan and South Korea's Stock Exchanges Surge

Taiwan's Stock Exchange Weighted Index has experienced a remarkable 92 percent jump since the start of 2025, while South Korea's Kospi has surged an impressive 226 percent in dollar terms over the same period. This rally is primarily driven by the growth in AI and semiconductor-linked stocks.

However, a closer examination of the data reveals that this upward trend is not broad-based. In both countries, a small group of heavyweight stocks is currently driving the market. This is evident in the significant increase in market capitalization (mcap) of these stocks.

Taiwan's Market Cap Surge

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Taiwan's overall market cap has increased by $2.05 trillion to $4.31 trillion from $2.26 trillion since the start of 2025 across its 1,056-stock index. Notably, the mcap of Taiwan's biggest stock, Taiwan Semiconductor Manufacturing Company, alone rose by $1.04 trillion, accounting for more than 50 percent of the total rise in Taiwan's market cap.

The next five stocks, Delta Electronics, MediaTek, ASE Technology Holding, Elite Material, and Unimicron Technology Corp, collectively contributed around 20 percent to the upward move. Conversely, the mcap of 549 stocks within the index declined during this period, while another 495 stocks added less than 1 percent to the total.

Korea's Kospi Market Cap Growth

Korea's Kospi mcap has increased by nearly $2.82 trillion to $4.11 trillion from $1.28 trillion across its 835-stock index since the start of 2025. Samsung Electronics and SK Hynix saw their market caps rise by $892 billion and $734 billion respectively, making the two stocks together responsible for more than 57 percent of the rise in Kospi's mcap.

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The next five stocks, SK Square, Hyundai Motor, Doosan Enerbility, Samsung Electro-Mechanics, and Hanwha Aerospace, collectively contributed just 10 percent to the move. The mcap of 207 Kospi stocks declined during this period, while nearly 600 stocks contributed less than 1 percent to the total.

Both countries' stock exchanges are the world's biggest outperformers so far in 2026, despite ongoing geopolitical tensions and the war between the US, Iran, and Israel. With gains concentrated among a limited number of stocks in both markets, it remains to be seen how long these rallies will sustain and how well these countries will be protected from ongoing geopolitical tensions.