South Korea's benchmark KOSPI index plunged more than 9% on Tuesday, forcing market circuit breakers as steep losses in semiconductor stocks pushed the broader market down.
By 02:01 GMT the index had fallen 9.2% to 6,134.77 points, marking its lowest level since mid-April. Trading was temporarily halted when the market dropped 8% and resumed following a 20-minute pause.
Memory chipmaker SK Hynix (000660) suffered a drop of more than 11%, extending losses after its U.S.-listed shares fell below their initial public offering price overnight. Samsung Electronics Co (005930) declined nearly 10%. Together, those two companies account for more than half of the KOSPI's weighting and were the primary drivers of the market’s deterioration.
The sell-off followed a nearly 5% overnight decline in NVIDIA Corporation (NVDA) shares after a Wall Street Journal report said the AI chipmaker could provide financial backing for a large OpenAI data center project. That report raised investor concerns about the scale and direction of AI infrastructure spending and its potential implications for chip demand dynamics.
Investors were further unsettled by rapid advances in China's semiconductor sector. The blockbuster market debut of memory chipmaker CXMT and reported progress in domestic lithography tool development heightened fears that competition for South Korean chipmakers could intensify.
The combined effect of worries over future AI-related capital allocation and intensifying competition from China left semiconductor stocks particularly hard hit, which in turn translated into a broad market rout given the outsized weighting of memory names in the index.
No new numerical forecasts or forward-looking claims were presented; coverage centered on the market moves, specific share price reactions and the reports that influenced sentiment.
Contextual note: The movements described reflect market trading on Tuesday and the immediate market response to the cited developments.