Key facts
- South Korean stocks fell nearly 10 percent on Tuesday.
- The KOSPI index closed down 9.99 percent at 8,203.84.
- Foreign investors sold major semiconductor shares, leading the decline.
- A circuit breaker was triggered on the Korea Exchange due to the sharp fall.
- The Korean won weakened against the U.S. dollar.
South Korean stocks experienced a significant downturn on Tuesday, with the benchmark Korea Composite Stock Price Index (KOSPI) plummeting nearly 10 percent. This sharp decline was primarily driven by foreign investors divesting from major semiconductor shares, including SK Hynix and Samsung Electronics, mirroring a broader sell-off in U.S. technology stocks. The KOSPI closed down 9.99 percent at 8,203.84 points, marking its largest single-day drop and triggering a 20-minute trading halt due to the activation of a circuit breaker.
SK hynix recently surpassed Samsung Electronics in market capitalization, becoming South Korea's most valuable company for the first time since 2000. Samsung Electronics, meanwhile, has achieved over US$1 billion in HBM4 chip sales just four months after commencing mass production. The strong performance of these companies has reportedly led to their employees being considered prime marriage prospects in South Korea.
The weakening of the Korean won against the U.S. dollar, trading at 1,539.1 won per dollar, added to the market's negative sentiment. The sell-off occurred despite reported progress in negotiations with Iran, with U.S. Vice President JD Vance stating a "very good foundation" had been established for a final agreement. However, U.S. stocks closed mixed, with the Nasdaq Composite falling 1.3 percent amid concerns over major technology companies, including a significant drop in SpaceX shares.