South Korean stocks tumbled nearly 10 percent Tuesday, marking one of the largest single-day declines in the index’s history and forcing the Korea Exchange (KRX) to halt trading for the fourth time in 2026.
After choppy trading that saw the KOSPI hit an intra-day high of 9,175.45, the benchmark index plunged 910.71 points, or 9.99 percent, to close at 8,203.84. The KRX activated a circuit breaker at approximately 2:33 p.m. local time after the index fell more than 8 percent from the previous session’s close. Trading of all stocks was suspended for 20 minutes. The exchange said it was the fourth such halt this year and the 10th on record.
The selloff was driven by aggressive selling from foreign and institutional investors. Foreign investors sold a net 4.13 trillion won, and institutional investors sold a net 4.55 trillion won. Retail investors acted as a counterweight, purchasing a net 8.58 trillion won on their own. Trade volume reached 483.7 million shares worth 59.9 trillion won (US$38.9 billion), with losers outpacing winners 856 to 46.
Large-cap shares closed mostly in negative territory.
Samsung Electronics and SK hynix tumbled 12.31 percent to 310,000 won and 12.47 percent to 2.55 million won, respectively. SK Square, the parent company of SK hynix, fell 7.01 percent to 1.83 million won, and Samsung Electro-Mechanics shed 9.6 percent to 1.99 million won.
Hyundai Motor, the country’s top automaker, lost 12.05 percent to close at 511,000 won. Battery maker LG Energy Solution dipped 6.1 percent to 362,000 won.
“Valuation concerns have grown for major South Korean semiconductor stocks after they repeatedly hit record highs in a short period, prompting heavy selling by foreign investors and increasing market volatility,” Seo Sang-young, an analyst at Mirae Asset Securities, said. He added that the nearly 1 percent decline in Nasdaq futures further dampened investor sentiment toward domestic chipmakers.
Overnight on Wall Street, U.S. stocks closed mixed. The technology-focused Nasdaq Composite fell 1.3 percent as large tech shares came under renewed pressure. Shares of SpaceX tumbled more than 16 percent after reports that the company is selling bonds to raise capital for artificial intelligence initiatives, adding to the sector’s weakness.
The South Korean won weakened against the U.S. dollar, quoted at 1,539.1 won per dollar as of 3:30 p.m., down 2.1 won from the previous session. Bond prices rose, pushing yields lower: the yield on three-year Treasurys fell 4 basis points to 3.770 percent, and the benchmark five-year government bond yield lost 2.8 basis points to 4.016 percent.
The selloff comes after a volatile period for the KOSPI, which MSI previously reported closed above 9,100 on June 22 on chip-sector gains and Iran diplomacy, and had topped 9,000 for the first time on June 18. The index crashed more than 8 percent on June 8 on AI-profit fears and Federal Reserve rate concerns before rebounding sharply in the days that followed.