South Korea's Kospi has staged a reversal from its latest rout, returning to bull-market territory as investors piled back into the semiconductor giants that dominate the index.

South Korean stocks rallied on Thursday, pushing the benchmark Kospi into a technical bull market.

The benchmark Kospi gained as much as 4.8% on Thursday, extending its gain from a July 30 low to around 22%. Heavyweight memory chipmakers Samsung Electronics Co. and SK Hynix…