U.S. CPI cools, boosting risk assets; South Korea's KOSPI rises over 7%, triggering a circuit breaker.

U.S. June CPI came in lower than expected, significantly cooling market expectations for a near-term Federal Reserve interest rate hike, driving gains in global risk assets. South Korea’s KOSPI index surged rapidly after opening on Wednesday, rising by more than 7% at one point during the session, triggering a temporary trading halt (circuit breaker) on the Korea Exchange; the KOSDAQ market also triggered a synchronized pause in program trading. Chip stocks led the market rally. SK Hynix’s ADRs jumped 27% overnight in U.S. trading, driving its South Korean shares up roughly 10% on Wednesday. Market analysts note that since SK Hynix’s ADR listing, price correlation between the U.S. and South Korean stock markets has further strengthened, potentially enabling cross-timezone transmission of market volatility. However, multiple institutions still warn that while the inflation data eased market concerns about a July interest rate hike, escalating tensions in the Middle East, rising oil prices, and inflationary pressures stemming from AI investment may still limit the Federal Reserve’s future policy space.