The KOSPI index dropped more than 5%, falling below the 6,700 mark. Major semiconductor stocks, including Samsung Electronics and SK Hynix, showed significant weakness, leading to increased volatility in both the KOSPI and KOSDAQ markets, prompting the activation of sell sidecars.
According to the Korea Exchange, as of 1:08 PM, the KOSPI was trading at 6,695.23, down 401.66 points (5.66%) from the previous trading day. The index opened at 7,000.78, down 96.11 points (1.35%), and continued to decline throughout the session.
Foreign and institutional investors sold a net 33.75 billion won and 16.84 billion won, respectively, contributing to the index's drop. In contrast, individual investors were net buyers, purchasing 50.99 billion won.
As market volatility increased, a sell sidecar for the KOSPI was activated at 11:23 AM. This occurs when the price of the most traded futures contract based on the KOSPI 200 falls by more than 5% for one minute.
The decline was primarily driven by major semiconductor stocks. SK Hynix was trading at 1,763,000 won, down 156,000 won (8.13%). Samsung Electronics also fell by 21,500 won (7.96%), trading at 248,500 won.
Other large-cap stocks also showed weakness, with Hyundai Motor (-8.68%), SK Square (-8.48%), Samsung Electro-Mechanics (-8.29%), Samsung C&T (-6.25%), Samsung Life (-5.61%), LG Energy Solution (-5.60%), and KB Financial (-4.76%) all declining. However, Samsung Biologics was the only stock showing strength, rising by 10.15%.
The KOSDAQ also experienced a decline of over 5%. At the same time, the KOSDAQ index recorded a drop of 40.57 points (5.13%), trading at 749.73.
In the KOSDAQ market, individual investors were net buyers, purchasing 48.21 billion won, while foreign and institutional investors sold a net 22.51 billion won and 25.53 billion won, respectively.
A sell sidecar for the KOSDAQ was activated at 11:47 AM after the KOSDAQ 150 futures fell by more than 6% and the KOSDAQ 150 index dropped by over 3% for one minute.
Factors weighing on the domestic stock market include geopolitical uncertainties in the Middle East and a surge in international oil prices.
As military tensions rise in the Middle East, Brent crude oil traded at $100.69 per barrel, up 7% from the previous session, surpassing $100 for the first time since May. West Texas Intermediate (WTI) also surged by 6.2%, reaching $92.19 per barrel. Concerns over oil supply disruptions have increased following attacks on Saudi Arabian tankers by Yemen's Iran-aligned Houthi rebels and ongoing military clashes between the U.S. and Iran.
Han Ji-young, a researcher at Kiwoom Securities, stated, "The current surge in oil prices is exerting upward pressure on interest rates again, which could create a burden on stock market valuations. However, it is important to note that the valuation burden on the KOSPI is lower compared to previous periods of rising interest rates."
* This article has been translated by AI.
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