The KOSPI index fell nearly 5% due to massive sell-offs by foreign and institutional investors, closing at the 7,600 level. During trading, the index dropped more than 8%, triggering a first-stage circuit breaker.
On July 7, the Korea Exchange reported that the KOSPI closed at 7,656.31, down 395.02 points (4.91%) from the previous trading day.
The index opened at 7,919.20, down 132.13 points (1.64%), and continued to decline. At around 10:23 a.m., a temporary trading halt known as a sidecar was activated due to program sell orders. This was the 16th sell-side sidecar this year, and including buy-side sidecars, it was the 32nd.
The decline accelerated further, and at 1:51:33 p.m., the KOSPI fell to 7,401.56, marking an 8.07% drop from the previous day, prompting the Korea Exchange to activate the first-stage circuit breaker.
The first-stage circuit breaker halts trading for 20 minutes if the KOSPI remains down more than 8% from the previous day's close for one minute.
The sharp decline was primarily driven by significant net selling from foreign and institutional investors. In the securities market, individuals net bought 3.1343 trillion won, while foreign and institutional investors net sold 2.9298 trillion won and 308.8 billion won, respectively.
Lee Kyung-min, a researcher at Daishin Securities, noted, "Foreign investors sold off shares in sectors such as semiconductors, substrates, shipbuilding, and defense, leading the KOSPI to retreat to the 7,400 level and triggering the circuit breaker."
However, he added, "Concerns about a slowdown in fundamental drivers in the domestic market have been raised, but they have not materialized. In fact, signs of improved earnings, upward revisions in forecasts, and adjustments in GDP growth rates are becoming evident."
Most of the top market capitalization stocks showed weakness. Samsung Electronics fell 7.08%, SK Hynix dropped 4.87%, SK Square declined 8.90%, Samsung Electro-Mechanics fell 9.74%, Hyundai Motor decreased 5.08%, LG Energy Solution dropped 6.63%, Samsung Life Insurance fell 4.19%, and Samsung C&T declined 5.67%. Only Samsung Biologics saw a rise of 0.57%.
The KOSDAQ index closed at 831.23, down 15.84 points (1.87%) from the previous trading day. The index opened at 843.74, down 3.33 points (0.39%), briefly turning positive in early trading but ultimately reversing to a downward trend.
In the KOSDAQ market, individuals and institutions net sold 361 billion won and 24.6 billion won, respectively, while foreign investors net bought 387.3 billion won.
Top market capitalization stocks showed mixed results. Alteogen rose 1.81%, Kolon TissueGene increased 6.91%, HLB gained 5.44%, and ABL Bio rose 4.32%. In contrast, EcoPro BM fell 1.64%, EcoPro dropped 1.40%, Rainbow Robotics declined 4.38%, JUSUNG Engineering fell 3.36%, Wonik IPS dropped 9.48%, and Rino Technology fell 4.14%.
* This article has been translated by AI.
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