Circuit breaker triggered intraday on U.S. AI regulation concerns; KOSPI plunges 6.02%
KOSDAQ drops 5.03%; selective strength seen in shares tied to tender offers and corporate governance
Domestic equities suffered a severe sell-off on the 6th, with both the KOSPI and KOSDAQ finishing sharply lower. Heavy foreign selling concentrated on semiconductor blue chips as concerns intensified over potential tightening of U.S. regulations on AI data center construction following the U.S. midterm elections. Early in the session, the KOSPI plummeted more than 8%, triggering a temporary circuit breaker and briefly breaching the 5,000 mark. Although the index pared some of its losses later in the day, it ultimately failed to hold the 5,100 line.
According to the Korea Exchange, the KOSPI closed down 324.11 points, or 6.02%, at 5,059.69. The tech-heavy KOSDAQ shed 34.14 points, or 5.03%, to end at 644.27. In the onshore foreign exchange market, the won-dollar exchange rate finished daytime trading up 14.5 won at 1,356.6 won.
The KOSPI opened lower, pressured by an overnight retreat on Wall Street triggered by regulatory concerns over U.S. AI data centers. While institutional buying helped trim some losses during the session, persistent foreign liquidation—particularly in electrical and electronic shares—dragged the benchmark down for a second consecutive session.
By sector, electrical and electronics dropped 7.9%, medical and precision instruments fell 7.2%, machinery and equipment declined 6.5%, and securities lost 5.7%. Large-cap stocks fell 6.3%, mid-caps dropped 3.3%, and small-caps declined 2.3%, underscoring a distinct large-cap-led downturn.
In the supply-demand breakdown, foreign investors net sold 2.77 trillion won ($2.04 billion), while institutional and retail investors net bought 1.70 trillion won and 604.6 billion won, respectively. Foreign outflows were heavily concentrated in electrical and electronics (2.09 trillion won), finance (258.5 billion won), and pharmaceuticals (91.1 billion won).
The KOSDAQ also opened lower tracking overnight losses in U.S. tech stocks, extending its losing streak to two sessions amid weakness in electrical/electronics and machinery/equipment counters. By sector, medical and precision instruments fell 8.6%, metals dropped 7.5%, and non-metallic minerals retreated 7.3%. Foreigners and retail investors net sold 101.3 billion won and 110.3 billion won, respectively, whereas institutions net bought 205.5 billion won.
Select Equities Gain on Tender Offers and Ownership Shifts
Lotterental (089860) climbed 10.40% on news that global private equity firm TPG is pursuing a tender offer and voluntary delisting. Hanjin KAL (180640) advanced 2.99% amid expectations of a potential proxy contest following the Hoban Group's emergence as its largest shareholder.
Naver (035420) rose 2.87% after global credit rating agency S&P reaffirmed its long-term issuer credit rating at 'A-' with a stable outlook.
Clean & Happy (004540) jumped 11.07% on growing expectations of management stabilization following the transition to a sole leadership system under Chairman Choi Hyun-soo.
Semiconductor and AI-Related Shares Plunge; Brokerages Suffer
Samsung Electronics (005930) dropped 6.35% as worries mounted over potential cuts to U.S. AI investments, while SK hynix (006600) plummeted 10.44% amid a broader U.S. semiconductor sell-off and apprehension over slowing data center spending.
AI semiconductor component and material suppliers also slumped. Doosan (000150) fell 11.27% as persistent concerns over the longevity of AI investments overshadowed growth expectations for its high-value copper-clad laminate (CCL) business. Hansol Technics (004710) retreated 8.96% as related market sentiment soured despite upbeat growth prospects for its semiconductor probe card operations.
Samsung Electro-Mechanics (009150) declined 7.84% on concerns that stricter U.S. regulations on data center construction would dull demand for electronic components.
Brokerage shares experienced synchronized weakness. Korea Investment Holdings (071050) plunged 17.34% following disappointing third-quarter earnings, while Mirae Asset Securities (006800) fell 7.90% under the weight of souring investor sentiment from the broader market crash and weakness across the securities sector.
Celimed (458870) tanked 29.95% after swinging to a net loss in the third quarter.
