South Korea stocks plunge 8 per cent as chip shares tumble
A circuit breaker was triggered on Friday morning after a sell-off in technology stocks pushed the KOSPI index below 5,000 points.
South Korea's benchmark KOSPI stock index fell more than 8 per cent in early trade on Friday, causing the index to drop below the 5,000-point level for the first time in nine months, according to The Economic Times.
The Korea Exchange (KRX) activated a 20-minute circuit breaker at 9:03 a.m. to halt all derivatives and stock trading. As of 0026 GMT, the KOSPI was down approximately 500 points, or 8.6 per cent, at 4,923.47.
The decline was led by a sell-off in semiconductor and technology stocks. Shares in Samsung Electronics dropped 10 per cent, while SK Hynix fell 13 per cent. Other losses included Hyundai Motor at 6.9 per cent, Kia Corp at 4 per cent, and LG Energy Solution at 4 per cent.
The downturn follows a sharp decline in US stock markets on Thursday. Uncertainty regarding AI and data centre policies after the Democratic Party's gains in the US midterm elections has affected hardware and chip suppliers.
Jun Kwang-woo, chairman of the Institute for Global Economics, suggested there may be an overreaction to the US election results. The former chairman of the National Pension Service expressed hope for stabilisation, noting that the speed of building AI infrastructure and data centres may slow due to concerns in various states, including Texas.