Foreign investors sold more than 4.5 trillion won ($3.1 billion) worth of stocks on the main board in a single session, sending the KOSPI down more than 5%. Large-cap chipmakers including Samsung Electronics and SK hynix collapsed across the board as concerns over overheated artificial intelligence investment combined with a Chinese memory chipmaker's announcement of a new product.
The KOSPI closed at 6,035.35 on the 13th, down 348.89 points, or 5.46%, from the previous session, according to the Korea Exchange. That marked the lowest close since this year's low of 5,593.56 on July 30. The index opened 3.10% lower and fell more than 7% during the session to as low as 5,911. At 9:47 a.m., a sell-side sidecar was triggered, temporarily suspending program sell orders after a sharp drop in KOSPI 200 futures.
Heavy foreign selling drove the decline. Foreign investors were net sellers of 4.52 trillion won on the main board. Retail and institutional investors were net buyers of 2.24 trillion won and 1.69 trillion won, respectively, hunting for bargains, but failed to halt the index's slide.
Among the largest stocks by market capitalization, chipmakers posted the steepest losses. Samsung Electronics closed at 232,000 won, down 7.39% from the previous session. SK hynix finished at 1.443 million won, down 10.09%. Samsung Electronics preferred shares fell 6.69%, SK Square dropped 12.91% and Samsung Electro-Mechanics declined 8.34%. LG Energy Solution rose 3.02% and Samsung Biologics gained 0.42%.
News of technological advances at China's ChangXin Memory Technologies (CXMT) weighed on chip stocks. CXMT said it had made fresh progress in DRAM technology and would unveil a next-generation server memory product within the year. The news also pushed down U.S.-listed chip stocks in the previous session, with Micron falling 3.88% and SanDisk dropping 5.97%. Comments from global semiconductor chief executives about the enormous capital required for AI infrastructure investment also dampened sentiment.
The KOSDAQ also fell, though less sharply than the KOSPI. The index closed at 837.03, down 12.16 points, or 1.43%, from the previous session. It had dropped to as low as 802 during the session before recovering part of the loss. Retail investors were net sellers of 191.1 billion won, while foreign and institutional investors were net buyers of 138.4 billion won and 42.9 billion won, respectively. Gains in some semiconductor materials, parts and equipment stocks cushioned the index's decline.
"Semiconductor sentiment weakened as reports of CXMT's next-generation memory launch plans coincided with remarks by Broadcom's CEO about constraints on expanding AI development," said Lim Jung-eun, an analyst at KB Securities. "Large-scale foreign selling was concentrated in large-cap chip stocks such as Samsung Electronics and SK hynix."
