The KOSPI closed on the 15th down 7.57% (454.59 points) at 5,554.22 (Dong-A Ilbo, Electronic Times). The previous close was 6,008.81 (Electronic Times). It was the seventh straight day of decline (Dong-A Ilbo). The Kosdaq ended down 7.65% at 760.82 (Electronic Times). A sell-side sidecar was triggered in both markets, and at midday stage-1 circuit breakers hit the Kosdaq (12:23 p.m.) and the KOSPI (12:38 p.m.) (Electronic Times). Trading on the Kosdaq resumed after a 20-minute halt (Korea Economic Daily). The 9% drop in Samsung Electronics and 11% drop in SK hynix were the biggest since late July (Yonhap). Yonhap reported that the market capitalization of listed companies shrank by more than 400 trillion won in a single day. The causes cited were a U.S. inflation shock and the debate over AI profitability, the so-called CoreWeave shock (Dong-A Ilbo, Electronic Times, Yonhap).
It is rare for an index to fall more than 7% in a day and for circuit breakers to hit both markets at once. With foreign selling long under way and the exchange rate rising too, fears grow of a vicious cycle in which capital flight feeds on itself. The index fell hard because the two chip stocks carry heavy weight.
The value of your stocks, funds and pension may have fallen. If you invested with borrowed money, a drop in the collateral ratio could lead your broker to force-sell shares. A higher exchange rate adds pressure on overseas payments and import prices. Selling on a plunge day may lock in losses, so it is better to check your investment horizon and purpose first.
The view that the market has begun to reassess AI investment profitability and debt burdens, and that the correction could continue.
The view that the fundamentals have not collapsed and this is a temporary plunge in which sentiment and flows were overly one-sided. It points out that expectations for chip earnings are unchanged.
What is confirmed is the size of the drop and the circuit breakers; the causes are emphasized differently by each outlet. The default-risk report involving CoreWeave comes from a single outlet, so we await confirmation. Today the fork in the road is whether foreign net selling eases and whether the exchange rate holds in the 1,350s. It is too early to judge a trend from a one-day rebound.
Dong-A Ilbo · Electronic Times · Yonhap · SBS · Korea Economic Daily · Chosun Ilbo · Yonhap News TV, the 15th
‘Black Thursday’: KOSPI plunges 7.57% to 5,554.22. Circuit breakers hit the Kosdaq as well
A U.S. inflation shock and the debate over AI profitability collided. Samsung Electronics fell 9% and SK hynix 11%, and the won-dollar rate climbed at one point into the 1,350s
The KOSPI closed on the 15th down 7.57% (454.59 points) at 5,554.22 (Dong-A Ilbo, Electronic Times). The previous close was 6,008.81; it opened at 5,673.01 that day and slid steadily (Electronic Times). It was the seventh straight day of decline (Dong-A Ilbo). The Kosdaq ended down 7.65% (63.06 points) at 760.82 (Electronic Times). In the morning a sell-side sidecar was triggered in both markets (Dong-A Ilbo, Electronic Times), and at midday a stage-1 circuit breaker hit the Kosdaq at 12:23 p.m. and the KOSPI at 12:38 p.m. (Electronic Times). Trading on the Kosdaq resumed after a 20-minute halt (Korea Economic Daily), and the KOSPI also resumed soon after (Yonhap, Korea Economic Daily). SBS said the drop briefly exceeded 8%, while Dong-A Ilbo reported the KOSPI fell more than 9% intraday. Samsung Electronics fell 9% and SK hynix 11%, the biggest drops since late July (Yonhap). Yonhap reported that the market capitalization of listed companies in Korea shrank by more than 400 trillion won in a single day.
The causes cited were a U.S. inflation shock and the debate over the profitability of artificial intelligence (AI) investment (Dong-A Ilbo, Electronic Times, Yonhap). Dong-A Ilbo and Electronic Times both pointed to worries over debt piled up by AI data center investment, the so-called ‘CoreWeave shock’. Korea Economic Daily reported that CDS on CoreWeave, Oracle and SoftBank soared together (Korea Economic Daily single report). Yonhap noted that U.S., Japanese and Taiwanese stocks fell only 1.9–4.9%, making the KOSPI drop unusually large, and the Nikkei index plunged 4.9%. Foreigners drove the flows. Dong-A Ilbo said foreigners sold more than 5 trillion won that day, and Yonhap reported net selling of nearly 18 trillion won this month, eight straight trading days. The won-dollar rate climbed at one point into the 1,350s, its highest in nine trading days (Yonhap, SBS), and the 3:30 p.m. reference rate was 1,344.6 won, up 6.3 won (Yonhap single report). U.S. producer prices came out after the Korean market closed. They rose 1.3% in September from the previous month, the biggest since March 2022 (Chosun Ilbo, Yonhap News TV). Korea Economic Daily and News1 reported 6.3% on an annual basis. Today, watch whether a rebound comes and whether foreign selling continues.