SEOUL, October 20 (AJP) - South Korean stocks fell more than 3 percent Tuesday morning as heavy foreign and institutional selling battered semiconductor shares.
The benchmark KOSPI fell 3.2 percent to 5,587.27 as of 10:30 a.m. (0130 GMT), after trading between 5,493.24 and 5,733.57.
Foreign investors sold 605.8 billion won ($456 million) worth of shares, as institutions followed with 470.7 billion won worth of sale. Retail investors bought 832.1 billion won, helping cushion the decline.
The selloff came a day in the wake of the KOSPI's rebound of 1.76 percent and President Lee Jae Myung's interventionist comment on Monday, calling Korean shares undervalued and stimuli measures to aid corporate governance and shareholder rights.
Speaking to reporters, Lee called the Seoul market undervalued after it suffered 16-percent plunge so far this month, adding the government was reviewing additional measures to normalize the stock market without specifying.
SK hynix dropped 3.6 percent to 1,231,000 won, while Samsung Electronics fell 1.5 percent to 214,500 won.
SK hynix shares came under particularly heavy pressure, briefly falling below 1.2 million won for the first time in nearly six months before recovering some losses.
The decline came amid growing concerns over a possible U.S. initial public offering of Solidigm, SK hynix's NAND flash memory subsidiary.
Solidigm has reportedly selected Goldman Sachs and Morgan Stanley as lead underwriters for a potential U.S. listing, raising concerns among investors that a separate listing could dilute the value of SK hynix and divert investment away from its Korean-listed parent.
The losses contrasted with an overnight rebound in U.S. semiconductor stocks. The Philadelphia Semiconductor Index rose 1.61 percent Monday, snapping an eight-session losing streak.
Micron Technology gained 2.97 percent, while AMD advanced 1.76 percent and Sandisk climbed 5.53 percent.
Despite the rebound, concerns over AI spending and corporate profitability continued to weigh on some U.S. technology companies, including Microsoft and Meta.
Elsewhere on the KOSPI, battery makers gave back some of Monday's gains. Samsung SDI fell 1.7 percent to 582,000 won, while Hyundai Motor dropped 3.7 percent to 313,500 won.
Doosan Enerbility declined 5 percent to 63,300 won, while defense manufacturer Hyundai Rotem plunged 12.7 percent to 88,000 won.
SK Square lost 4.1 percent to 749,000 won, and Celltrion slipped 0.9 percent to 196,400 won.
Power equipment and cable manufacturers also came under pressure as investors reassessed the outlook for AI infrastructure spending.
LS Electric fell 6.38 percent to 154,100 won, while HD Hyundai Electric dropped 6.95 percent. Iljin Electric lost 7.01 percent, and LS Eco Energy plunged 14.85 percent.
The losses followed concerns over project delays and the pace at which power equipment makers could convert their order backlogs into revenue.
SK Securities lowered its target price for Hyosung Heavy Industries to 2.5 million won from 4 million won, citing a lower valuation multiple and expectations that third-quarter earnings would fall short of market estimates.
Despite the broader selloff, some electronic component manufacturers advanced. Samsung Electro-Mechanics rose 1.8 percent to 1,191,000 won, while Daeduck Electronics gained 3.7 percent to 138,750 won.
Korea Circuit surged 18.3 percent to 76,500 won, helping printed circuit board stocks outperform the broader market.
The tech-heavy KOSDAQ fell 2.7 percent to 786.70, after trading between 773.32 and 807.22.
Foreign investors sold 187.9 billion won worth of shares, as institutions offloaded 98 billion won. Retail investors bought 288 billion won.
Battery-related shares were among the heavy decliners on the KOSDAQ, with EcoPro falling 5.8 percent to 85,200 won and EcoPro BM dropping 6.4 percent to 108,300 won.
Jusung Engineering slipped 2.2 percent to 205,000 won, while HLB edged down 0.7 percent to 42,650 won.
Alice plunged 25.6 percent to 67,300 won, making it one of the sharpest decliners among actively traded stocks.
By contrast, HT Robotics jumped 17.3 percent to 10,700 won, while Vinatech rose 11.8 percent to 91,800 won.
G2G Bio surged 14.9 percent to 37,000 won, and SungHo Electronics gained 3.8 percent to 27,875 won.
Asian markets started the session weak alongside Korea as Japan's Nikkei 225 slipped 0.8 percent to 64,402.2, while Hong Kong's Hang Seng Index fell 1.1 percent to 23,910.68. China's Shanghai Composite declined 0.2 percent to 3,722.17.
The Korean won strengthened 0.3 percent to 1,328.90 won per dollar.
Oil prices edged higher amid continuing tensions in the Middle East and Eastern Europe, although signs of recovering crude shipments from the Persian Gulf helped ease some supply concerns.
West Texas Intermediate crude rose 0.2 percent to $98.70 a barrel, while Brent crude gained 0.2 percent to $109.77.
U.S. Energy Secretary Chris Wright said crude shipments from the Persian Gulf had recovered to about 80 percent of prewar levels, although supplies of refined petroleum products remained constrained.
Continued attacks on commercial vessels near the Strait of Hormuz and renewed strikes on energy infrastructure in Russia and Ukraine kept supply risks elevated.
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