Seoul Stocks Trigger Circuit Breaker as Chipmakers Plunge
Panic selling over AI spending fears sent South Korea’s benchmark below 5,000, with circuit breakers halting trading and chipmakers losing nearly 10%.
- On Friday, the South Korean benchmark KOSPI plunged more than 8% in early trading, triggering a 20-minute circuit breaker as it fell below the 5,000 mark for the first time in months.
- Investors dumped chipmakers following a sharp overnight sell-off on Wall Street, where concerns grew that Democrats' midterm election victories could lead to stricter regulations on data-center development, potentially curbing demand for AI chips.
- Shares of major chipmakers suffered sharply, with SK hynix tumbling about 11.7% and Samsung Electronics falling about 10% in early trading, as selling pressure spread to other large stocks including Hyundai Motor, down 6.8%.
- Finance Minister Lee Hyoung-il pledged Friday that financial authorities will formulate measures to stabilize market volatility, with speculation about potential interventions including a short-selling ban or stock market stabilization fund.
- Despite the turmoil, President Lee Jae Myung committed in his budget speech on Nov. 2 to doubling spending on AI and semiconductors to a record $16 billion in 2027, underscoring South Korea's heavy economic reliance on the sector.
20 Articles
20 Articles
Asian markets today: South Korea's Kospi crashes 8%, plunges below 5,000 | What's behind the sell-off?
Asian markets today: South Korea's benchmark KOSPI index plunged 8.5% in early trading on Friday, November 6, tracking a sharp sell-off in artificial intelligence (AI) and semiconductor stocks on Wall Street overnight.
South Korea stocks plunge 8%, circuit breaker triggered as chip shares tumble
South Korea's KOSPI stock index fell more than 8% during early trading on Friday, reflecting a significant sell-off. The stock market decline was primarily driven by losses in technology and semiconductor shares. As a result, a circuit breaker was activated by the Korea Exchange to halt trading temporarily. Experts indicated that the reaction may be an overreaction to recent US midterm election outcomes.
Watch Kospi Slides After US Rout, Triggering Circuit Breaker
Asian stocks slumped after a post-election rout in chipmakers deepened on Wall Street amid growing concern that Democrats will seek tighter regulation of the artificial intelligence industry. Bloomberg's Paul Dobson has the context.
(Seoul = Yonhap News) Reporter Lim Eun-jin = On the 6th, the KOSPI plummeted by more than 8%, breaking the 5,000 mark during trading.
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