South Korea’s KOSPI Crashes Over 8% As Samsung Electronics And SK Hynix Shares Tumble, Triggering Circuit Breaker

South Korea’s stock market came under heavy selling pressure on Friday, with the benchmark KOSPI plunging more than 8% in early trade. A sharp fall in semiconductor and technology stocks dragged the index below the 5,000 mark for the first time in nine months, prompting the Korea Exchange (KRX) to halt trading temporarily.

The exchange activated a 20-minute circuit breaker at 9:03 AM local time (0003 GMT). The measure suspended trading in stocks and derivatives after the KOSPI’s steep decline.

At 0026 GMT, the index was down around 500 points, or 8.6%, at 4,923.47.

Samsung Electronics, SK Hynix Lead The Sell-Off

Chip stocks were among the worst hit during the session. Samsung Electronics shares fell 10%, while rival SK Hynix plunged 13%.

The selling also spread to other heavyweight stocks. LG Energy Solution, a major battery maker, declined 4%. Hyundai Motor shares dropped 6.9%, while Kia Corp lost 4%.

The fall in Seoul followed a sharp sell-off on Wall Street on Thursday. US stocks recorded their worst single-day performance in more than a year as investors pulled money out of technology and semiconductor shares that had seen strong gains.

US Midterm Election Outcome Adds To AI Concerns

Uncertainty over the future of artificial intelligence investment and data centre projects has added to the pressure on technology stocks. The Democratic Party’s sweeping gains in the US midterm elections have raised questions about the direction of policies affecting AI infrastructure and related businesses.

These concerns have also weighed on suppliers of chips and other hardware used in data centres.

Jun Kwang-woo, chairman of the Institute for Global Economics and a former head of South Korea’s National Pension Service, said the market may be seeing an overreaction to the US election outcome. He described the correction as necessary but said the pace of the fall could be excessive.

Jun also pointed to concerns in several US states, including Texas, that could slow the expansion of AI infrastructure, particularly data centres. He said he hoped markets would stabilise soon.

For South Korea, the sharp decline in Samsung Electronics and SK Hynix is particularly significant given their weight in the domestic stock market. Friday’s fall also shows how quickly concerns about US technology investment can spill over into Asian markets, where semiconductor companies are closely tied to global demand.

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