The KOSPI took a direct hit from the plunge in semiconductor stocks on New York's exchanges, triggering a sell sidecar. Despite easing inflation concerns in the US market, a wave of large-scale profit-taking centered on major chipmakers weighed on Korean equities.
According to the Korea Exchange, the KOSPI stood at 6,886.48 as of 9:21 a.m. on the 16th, down 5.46% from the previous trading day. After opening at 6,960.50, down 4.45%, the index extended its losses. Amid the sharp early decline, the KOSPI triggered a sidecar, a temporary suspension of program sell orders, at around 9:10 a.m.
Samsung Electronics (005930) was trading at 259,000 won, down 7.33%, while SK hynix (000660) fell 9.89% to 1.876 million won. Large-cap semiconductor-related stocks including SK Square (-11.51%), Samsung Electronics preferred shares (-6.77%), and Samsung Electro-Mechanics (-10.05%) all fell sharply, dragging down the index.
On New York's exchanges overnight, the June Producer Price Index (PPI) came in below market expectations, spreading hopes for easing inflation. In contrast, however, the semiconductor sector was thoroughly shunned. Major chip stocks weakened in tandem, with Micron Technology plunging more than 8%, along with Intel (-4.43%) and AMD (-3.46%). As a result, the Philadelphia Semiconductor Index fell 2.08%, freezing investor sentiment toward domestic semiconductors as well.
In particular, SK hynix's American Depositary Receipt (ADR), recently listed on the New York exchange, plunged 9.00% from the prior session, which is interpreted as stoking supply-demand instability for Korea's two leading chipmakers. Uncertainty across the broader industry cycle is cited as a factor fueling the appetite for profit-taking.
The KOSPI had rebounded 6% the previous day, recovering the 7,000 level for the first time in three trading days. Buying rushed in, with both the KOSPI and KOSDAQ triggering buy sidecars during the session. Foreign investors mounted an aggressive buying spree, net-purchasing 2.3308 trillion won on the KOSPI to lift the index. The scale of foreign net buying was the fourth largest this year. However, the sharp drop just one day later rendered the previous day's gains meaningless. The KOSDAQ was also trading at 804.68, down 2.98% from the prior session.
