Trading was suspended on both of South Korea's main stock markets on the 15th after a U.S.-driven interest rate shock and mounting concern over debt tied to artificial intelligence infrastructure sent shares tumbling. The circuit breakers were the first in 51 trading sessions since late July, with the KOSPI breaking below 5,600 amid relentless foreign selling and heading toward the lows of July's rout.
Stage-one circuit breakers were triggered in succession on the KOSPI and KOSDAQ markets shortly after noon, according to the Korea Exchange. The KOSPI stood at 5,527.12 at the time, down 481.69 points, or 8.02%, from the previous session. The KOSDAQ had fallen 68.45 points, or 8.31%, to 755.43. All trading on both markets was halted for 20 minutes, followed by a 10-minute single-price auction before trading resumed. It was the KOSPI's 10th circuit breaker this year and the 16th on record. For the KOSDAQ, it was the fifth this year and the 15th overall.
Steep losses in the country's two largest chipmakers drove the selloff. At the time the circuit breakers were triggered, Samsung Electronics (005930.KS) had dropped 9.91% to 209,000 won, falling below the 210,000-won level, while SK hynix (000660.KS) plunged 11.28% to 1.259 million won. Foreign investors alone sold a net 2.9012 trillion won ($2.04 billion) worth of shares on the main board, extending their selling streak to eight sessions. Retail investors and institutions bought a net 1.2169 trillion won and 1.2701 trillion won, respectively, but the buying was not enough to stem the rout. On the KOSDAQ, retail investors bought a net 18.7 billion won and foreign investors 5.8 billion won, while institutions sold a net 28.8 billion won.
The plunge came as warnings over the profitability of AI investment in the U.S. collided with renewed fears of high interest rates. Research firm Gartner cautioned that $3.5 trillion in AI infrastructure investment is at risk of impairment through 2030, while yields on maturing bonds of AI cloud provider CoreWeave approached 15%, spreading concern about debt at technology companies. The U.S. consumer price index rose 3.7% in September, stoking worries about tighter policy, while an attack by Yemeni rebels on Aramco pushed up global oil prices and sent government bond yields sharply higher, maximizing demand for safe-haven assets.
Analysts were reluctant to name technical support levels as selling begat more selling. Still, with the market in an extremely oversold state after seven straight sessions of declines, TSMC's earnings due at 3 p.m. and upcoming results from U.S. technology giants are seen as the key test of how much further the index can fall. "This is an oversold market where macro tightening and fears of an AI peak have been priced in all at once," one securities industry official said. "We need to watch whether indiscriminate foreign selling calms down and whether technical bargain-hunting comes in."
