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KRX activates buy-side sidecar for KOSPI on sharp rise

Created at 10 Jul · 4:40 AM1 source↑ Market-relevant
IN SHORT

South Korea's bourse operator activated a buy-side sidecar for the KOSPI index on Friday due to a sharp rise, suspending program trading for five minutes. The index surged over 5 percent, driven by semiconductor shares.

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Key Numbers

5.6 percentKOSPI index rise
7,700.32KOSPI index level
1:10 p.m.Time of index level
12:54 p.m.Sidecar activation time
five minutesProgram trading suspension duration
5 percentKOSPI 200 Futures index trigger threshold
one minuteDuration for KOSPI 200 Futures index trigger

Who's Involved

Korea Exchange (KRX)
South Korea's bourse operator that activated the buy-side sidecar
Kim Soo-yeon
Author of the news report
KRX activates buy-side sidecar for KOSPI on sharp rise

↳ Why This Matters

The activation of a buy-side sidecar indicates significant market volatility, signaling a rapid and substantial price movement that requires intervention to prevent excessive fluctuations and ensure market stability.

Key facts

  • The Korea Exchange (KRX) activated a buy-side sidecar for the KOSPI index.
  • Program trading for KOSPI-listed shares was suspended for five minutes at 12:54 p.m.
  • The KOSPI index rose 5.6 percent to 7,700.32 as of 1:10 p.m.
  • The rally was fueled by strong performance in semiconductor shares.
  • U.S. stocks also closed higher overnight, contributing to the market's upward movement.

South Korea's benchmark Korea Composite Stock Price Index (KOSPI) experienced a sharp rise on Friday, prompting the Korea Exchange (KRX) to activate a buy-side sidecar. This measure led to a five-minute suspension of program trading for KOSPI-listed shares, beginning at 12:54 p.m.

The KOSPI surged by 5.6 percent, reaching 7,700.32 as of 1:10 p.m. The rally was primarily driven by a strong performance in semiconductor shares. This upward momentum followed a positive close in U.S. stocks overnight, which were buoyed by a rebound in semiconductor shares and easing oil prices. A buy-side sidecar is typically triggered when the KOSPI 200 Futures index rises 5 percent or more for at least one minute.

Frequently asked questions

A buy-side sidecar is a market mechanism designed to temporarily halt program trading when an index experiences a rapid and significant rise or fall, aiming to curb excessive volatility.

The buy-side sidecar was triggered because the KOSPI 200 Futures index rose 5 percent or more for at least one minute.

Program trading for KOSPI-listed shares was suspended for five minutes.

What Happens Next

01Market participants will monitor for further volatility and potential future sidecar activations.
02The performance of semiconductor stocks will continue to be a key driver for the KOSPI.

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Cadence
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How It Developed

The Korea Exchange (KRX) activated a buy-side sidecar for the KOSPI.
Program trading for KOSPI-listed shares was suspended for five minutes.
The KOSPI rose 5.6 percent to 7,700.32 as of 1:10 p.m.
The rise was led by semiconductor shares and a rebound in U.S. stocks.

Sources

T1
KRX activates buy-side sidecar for KOSPI on sharp riseYonhap News Agency

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