South Korea chipmakers lead 10 percent KOSPI rout, global stocks slide

A tech-heavy sell-off can do more than shake trading screens: when chip giants lead the decline, the damage can ripple through retirement accounts, pension funds and corporate balance sheets far beyond Seoul. That danger was on display as South Korea’s benchmark market plunged almost 10%, then pulled Europe and U.S. futures into the same downdraft.

The Korea Composite Stock Price Index closed at 8,203.84, down 910.71 points, or 9.99%, after touching an intraday high of 9,175.45. The Korea Exchange triggered a circuit breaker at about 2:33 p.m. after the index fell more than 8% from the previous close, halting all-stock trading for 20 minutes. It was the fourth such halt in South Korea this year and the 10th on record, underscoring how violently the market had swung.

Selling was heaviest in the country’s best-known chipmakers. SK hynix dropped 12.47% and Samsung Electronics fell 12.31% as investors cashed in gains and reassessed stretched valuations in South Korea’s AI-linked leaders. Foreign investors sold a net 4.13 trillion won, and institutions sold 4.55 trillion won, while retail investors stepped in as net buyers of 8.58 trillion won. The won weakened to 1,539.1 per dollar as of 3:30 p.m., a sign that the rout had widened into a broader risk-off move.

The pressure did not stop at South Korea’s borders. ASML fell 5.2% in Europe and lost about $38 billion in market value in the first two hours of trading, while BE Semiconductor, ASM International, STMicroelectronics and Infineon also slumped. The pan-European Stoxx 600 fell about 1.1% to 1.2% in early trade, and its technology subindex lost 3.2%. Nasdaq 100 futures dropped about 2.7% to 2.8%, pointing to a weak start on Wall Street after a losing session for U.S. technology shares.

Market strategists said the move reflected crowded positioning as much as economics. Joachim Klement of Panmure Liberum said tech stocks had become "very overbought" and that the market was "getting rid of that overbought situation." UBS European equity strategy head Gerry Fowler said investors were increasingly questioning how much upside remained versus risk in AI-related stocks. That split matters: some of Tuesday’s damage was a sharp correction in overheated valuations, but the speed of the move also showed how fragile confidence has become when the market is leaning on a narrow group of chip and growth names.