Both the KOSPI and KOSDAQ indexes triggered sell-side sidecars, a temporary suspension of program sell orders, on the 24th ahead of the weekend. The KOSPI gave up the 7,000 level it had reclaimed in the previous trading session, while shares of major companies including Samsung Electronics and SK hynix fell sharply.
The Korea Exchange (KRX) triggered a sell-side sidecar in the KOSPI market at 11:23 a.m. that day. At 11:47 a.m., it applied a sell-side sidecar to the KOSDAQ market, cushioning the market shock. A KOSPI sell-side sidecar is triggered when KOSPI 200 futures (nearest month) fall 5% from the previous trading day and the decline persists for one minute. A KOSDAQ sell-side sidecar is applied when the KOSDAQ 150 futures index falls 6% or more from the previous day's close and the KOSDAQ 150 spot index falls 3% or more, with the situation continuing for one minute.
The KOSPI opened at 7,000.78 that day, down 96.11 points, or 1.35%, from the previous trading day. The decline subsequently widened, and the index is currently showing a drop of more than 5%. Most top market-cap stocks were in the red, including Samsung Electronics (-7.41%), SK hynix (-7.19%), and SK Square (-8.19%). The KOSDAQ also fell about 5%, with Rainbow Robotics (-15.65%) and Jusung Engineering (-11.84%) declining sharply.
On the New York stock market overnight, the three major indexes all fell. The Dow Jones Industrial Average dropped 0.97% from the previous session, the Standard & Poor's (S&P) 500 fell 1.21%, and the Nasdaq index fell 2.15%. The decline is interpreted as a deterioration in investor sentiment after repeated reports that tensions in the Middle East were escalating, with doubts about the sustainability of artificial intelligence (AI) investment that led the market rally not fully resolved. U.S. President Donald Trump said in an interview with a local media outlet that he was "considering a large-scale attack" on Iran.
Concerns about a further rise in oil prices also remain. The Iran-aligned Houthi rebels in Yemen declared a Red Sea blockade targeting Saudi Arabia and said they were behind the previous day's airstrikes on two Saudi Arabian oil tankers. With traffic through the Strait of Hormuz effectively halted, concerns are growing that a serious blow to the Middle East crude oil supply chain would result if the nearby strait is also blocked.
