Market AnalysisJun 25, 20262 Min

South Korea’s Kospi slides 10% after brief halt in trading; Samsung loses 10%, SK Hynix down 12%

South Korea’s benchmark stock index, the Korea Composite Stock Price Index (Kospi) saw a steep correction on Tuesday, falling as much as 10% in the intra-day session after a brief halt in trading was triggered.

Interestingly, Kospi tumbled from record high levels seen in the previous sessions as investors sold off chip heavyweights on fears that the AI rally had overstretched.

Other Asian markets joined the selloff, with Japan’s Nikkei 225 tumbling 3.6%, China’s Shanghai Composite index falling 1.4%, Hong Kong’s Hang Seng declining 2% and India’s Nifty slipping 0.6%.

On Tuesday, South Korea’s bourse operator activated a circuit breaker for Kospi after the tech-heavyweights in the index witnessed a crash.

The Korea Exchange (KRX) triggered the measure at around 2:33 pm local time after the Kospi plummeted over 8% from the previous session’s close. Trading of Kospi-listed shares was halted for 20 minutes.

However, the circuit breaker failed in its purpose as the Kospi extended its decline to 9.1% as soon as trading resumed. Shares of chipmaker SK Hynix Inc. dived more than 12%, while South Korea’s most valued company, Samsung Electronics Co., lost more than 10%.

This was the fourth time in calendar year 2026 that the KRX activated a circuit breaker. So far, the circuit breaker has been triggered only 10 times. A circuit breaker is triggered when the index falls 8% or more from the previous trading day and the drop lasts for one minute.

Notably, Tuesday’s correction came after the Kospi staged a strong rally earlier this month, hitting a series of record highs and crossing the 9,000 level for the first time after concerns around the US-Iran war eased.

However, a slump in technology shares in the US trade overnight on Monday broke the momentum and raised fresh worries that the recent rally in tech and AI stocks has overstretched itself.

A slide in SpaceX shares worsened the sentiment. The SpaceX stock fell over 16% on Monday to close at $154.60, marking its third consecutive session of decline. The stock had fallen 5% and 3.6% on Wednesday and Thursday last week, respectively, and is now down nearly 24% over the past three sessions.

Focus also shifted towards memory chipmaker Micron Technology Inc.’s quarterly earnings that are due later this week.