The KOSPI index experienced extreme volatility on June 26, plummeting over 5% to close at 8,411.21 after a mid-day drop exceeding 8% triggered a circuit breaker. A sell-side circuit breaker was activated early in the session, but it failed to halt the decline as foreign and institutional investors sold off, pushing the index down to the 8,400 level. The KOSDAQ also fell by more than 4%.
According to the Korea Exchange, the KOSPI closed down 519.09 points, or 5.81%, from the previous trading day.
The index opened at 8,813.18, down 117.12 points, or 1.31%, and quickly expanded its losses. At 11:12 a.m., a sell-side circuit breaker was triggered due to a sharp drop in KOSPI 200 futures, and at 12:10 p.m., the KOSPI fell more than 8%, activating the first stage of the circuit breaker. Trading in the cash market was halted for 20 minutes before resuming with single-price trading.
The decline was primarily driven by foreign and institutional selling.
In the securities market, individuals purchased a net 9.5872 trillion won, while foreign and institutional investors sold a net 5.429 trillion won and 4.5154 trillion won, respectively.
Most of the top market capitalization stocks closed lower, including Samsung Electronics (-5.30%), SK Hynix (-8.36%), SK Square (-9.43%), Samsung Electro-Mechanics (-0.20%), Hyundai Motor (-4.47%), Samsung Life (-3.24%), Samsung C&T (-4.72%), LG Energy Solution (-5.82%), and Samsung Biologics (-3.10%).
The KOSDAQ index closed at 851.37, down 36.44 points, or 4.10%. It opened at 884.43, down 3.38 points, or 0.38%.
In the KOSDAQ market, foreign and institutional investors bought a net 373.1 billion won and 309.4 billion won, while individuals sold a net 696 billion won.
Among the top KOSDAQ stocks, Alteogen (-8.40%), EcoPro BM (-7.15%), EcoPro (-6.47%), Rainbow Robotics (-6.98%), Kolon TissueGene (-4.99%), and Juseong Engineering (-0.78%) also closed lower. In contrast, Wonik IPS rose by 5.88%.
Market analysts noted that the weakness in U.S. tech stocks has dampened investor sentiment, while profit-taking in semiconductors following a recent rebound and end-of-quarter adjustments contributed to the market's decline.
Lee Kyung-min, a researcher at Daishin Securities, explained, "Following Apple's announcement of product price increases, concerns about surging memory demand due to AI data center expansions and cost burdens have intensified. Additionally, news of OpenAI considering delaying its IPO has spread doubts about the value of AI-related companies and investment demand."
He added, "The sharp rise in memory prices is leading to cost burdens for hyperscalers, which could ultimately result in a slowdown in memory semiconductor demand. The large semiconductor stocks that surged on Micron's strong performance have sharply reversed, shaking the market's leading stocks and spreading risk-averse sentiment across all sectors."
He concluded, "Recently, the domestic market has seen continued outflows of foreign investment, triggering the fifth circuit breaker this year. Currently, the fear and greed index is at around 26 points, nearing the fear zone."
* This article has been translated by AI.
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