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KOSPI Plunges Nearly 10% as Tech Sell-Off Triggers Market-Wide Circuit Breaker

Regulators say leveraged chip ETFs and heavy margin use left the market fragile and they are weighing stabilising steps.

Overview

  • The benchmark KOSPI closed down 9.99% on Tuesday after a sharp global tech sell-off forced the Korea Exchange to halt trading for 20 minutes.
  • Samsung Electronics and SK hynix each fell about 12%, driving the bulk of the index's losses and wiping billions from market value.
  • Foreign and institutional investors recorded large net sales while domestic retail investors were net buyers, and trading volume reached unusually high levels.
  • The Financial Supervisory Service publicly said it regretted the rapid approval of leveraged ETFs tied to chip names and is 'seriously looking into' possible stabilising measures.
  • Market participants are watching U.S. tech sentiment, upcoming semiconductor earnings, and U.S. interest rate signals for the next catalysts that could deepen or stabilise the sell-off.