South Korea’s stock market is becoming one of the world’s most important gauges for the AI trade, with its sharp swings increasingly spilling over into Wall Street and beyond.

On Tuesday, the country’s benchmark Kospi index closed 3.6% higher following a program trading halt, extending another volatile stretch that began when a record-setting rally earlier this year gave way to a sharp pullback in recent weeks. Samsung Electronics’ stock closed 6.2% higher while SK Hynix’s shares ended 4.1% up.

Once dismissed as a market trading at a discount to its global peers, South Korea has become a focal point for investors as AI spending turbocharged chipmakers Samsung Electronics and SK Hynix, reshaping…