South Korean stocks experienced a significant drop of almost 6% on Friday, following recent surges driven by artificial intelligence (AI) related stocks. The benchmark Korea Composite Stock Price Index (KOSPI) closed at 8,411.21, losing 5.81% after hitting a low of 8,126.84. This decline came after consecutive gains of 5.42% on Thursday and 3.26% on Wednesday.
The market downturn led to the activation of a circuit breaker by the bourse operator, halting trading for 20 minutes as the index plummeted more than 8%. Tech heavyweights on Wall Street showed mixed results, with Micron Technology rising by 15.7% on strong earnings, while Apple fell by 6.1% due to increased prices on its products driven by expensive memory chips.
Trading volume was substantial at 508.9 million shares valued at 51.5 trillion won (US$33.5 billion), with decliners outnumbering gainers significantly at 777 to 111. Foreigners and institutions sold a net 4.6 trillion won and 3.8 trillion won worth of shares, respectively, while individuals bought a net 8.2 trillion won.
Concerns over rising prices of memory chips impacting end-use products and potentially hindering AI investments led to the market unease. Semiconductor shares, particularly Samsung Electronics and SK hynix, faced notable declines. Samsung Electronics dropped by 5.3% to 339,500 won, while SK hynix slumped by 8.36% to 2.67 million won.
Financial shares also saw a downturn, with major banking group Hana Financial Group declining by 3.77% and Samsung Securities skidding by 6.32%. The Korean won was quoted at 1,532 won per U.S. dollar, marking an increase of 10.7 won from the previous session.
