Kospi Plunges 8.3% in ‘Black Monday,’ Posting Second-Biggest Point Loss on Record

A global rout in semiconductor stocks hammered South Korea’s equity markets on June 8, with the Kospi and Kosdaq closing down more than 8% each. The Kospi posted its second-largest point decline on record. Trading was briefly halted in both markets after circuit breakers were triggered, highlighting a sharp freeze in investor sentiment.

The Korea Exchange said the Kospi closed at 7,484.41, down 676.18 points, or 8.29%, from the previous session. That was the index’s second-biggest point loss ever. The largest was a 698.37-point drop on March 4 during the U.S.-Iran war. The benchmark slid more than 8% early in the session and fell as low as the 7,442 level intraday.

The exchange triggered a circuit breaker at 9:03 a.m., halting trading on the main board for 20 minutes. A circuit breaker is activated when the Kospi remains down 8% or more from the previous close for at least one minute. It was the third Kospi circuit breaker this year and the ninth on record.

The Kosdaq was hit just as hard. The index closed at 911.39, down 91.05 points, or 9.08%, from the previous trading day. It fell more than 8% during the session, prompting a 20-minute trading halt from 2:36 p.m. It was the second Kosdaq circuit breaker this year and the 12th on record.

The selloff appeared to spill over from a correction in U.S. chip stocks. On June 5, Broadcom issued an outlook for artificial intelligence chip revenue that missed market expectations, sending the Philadelphia Semiconductor Index down 10.3%. Major AI chip stocks including Nvidia, Advanced Micro Devices and Micron Technology also fell, further undermining investor sentiment.

A stronger-than-expected U.S. jobs report also helped trigger the decline. Investors worried that solid labor-market data could revive prospects for an interest-rate increase. On June 5, the U.S. Labor Department said nonfarm payrolls rose by 172,000, more than double the market forecast of 85,000.

On the Kospi, institutions were net sellers of 2.6507 trillion won, while foreigners sold a net 240.2 billion won. Retail investors were net buyers of 2.6039 trillion won.

Most large-cap stocks fell sharply. Samsung Electronics closed down 10.18% at 295,500 won, while SK Hynix fell 7.68% to 1,911,000 won. Other steep decliners included SK Square, down 11.13%, Samsung C&T, down 11.29%, KB Financial Group, down 11.71%, Hyundai Mobis, down 12.2%, and Doosan Enerbility, down 10.25%.

By contrast, stocks tied to expectations for AI cooperation advanced. NAVER rose 9.2% to 279,000 won. SK Networks hit its daily limit and finished at 14,170 won. The company was not a direct party to the AI cooperation announced that day between SK Group and Nvidia, but investors appeared to price in expectations for a shift toward an AI-focused business investment company.

On the Kosdaq, foreigners were net buyers of 328.8 billion won. Individuals and institutions were net sellers of 158.5 billion won and 160.9 billion won, respectively.

Most of the Kosdaq’s biggest companies also slumped. EcoPro BM fell 11.33%, Alteogen dropped 12.93%, EcoPro lost 11.22%, Rainbow Robotics slid 8.68%, Jusung Engineering declined 12.95%, and Samchundang Pharm sank 18.15%. Wonik IPS tumbled 20.95%.

In Seoul’s foreign-exchange market, the won closed at 1,535.0 per dollar, compared with 1,539.1 in the previous session. The currency opened sharply weaker, but verbal intervention by foreign-exchange authorities appeared to cap further losses.

Kim Yeon-ji, Hankyung.com reporter kongzi@hankyung.com