The benchmark opened 4.96% lower and fell as much as 6.4% in early trading. The Korea Exchange activated the sell-side sidecar at 9:06 a.m. local time, temporarily suspending program sell orders for five minutes after KOSPI 200 futures remained at least 5% below their previous close for one minute.
The KOSPI later recovered part of the decline and was trading around 5.2% lower at 6,515.97 during the session.
Samsung And SK Hynix Lead Semiconductor Rout
Samsung Electronics fell as much as 7.7% during the early selloff, while SK Hynix dropped more than 9% as investors cut exposure to the two stocks that have dominated South Korea’s AI-driven equity rally.
Losses moderated later in the session, with Samsung down about 6.9% and SK Hynix off 7.9%. The moves followed another weak Wall Street session in which the Philadelphia Semiconductor Index dropped 5.6%, Micron lost roughly 7% and Nvidia fell more than 2%.
Korean chip stocks have already experienced repeated bouts of extreme volatility this year. The KOSPI plunged nearly 10% in June as Samsung and SK Hynix each lost more than 12%, while an earlier June rout triggered a 20-minute market-wide trading halt after the index dropped more than 8%.
Sidecar Count Reaches 48 In 2026
Wednesday’s intervention was the 48th KOSPI sidecar activation of 2026, including 25 sell-side and 23 buy-side triggers. The count is substantially higher than the 10 events cited in some early market summaries.
South Korea’s volatility has intensified alongside the rapid growth of leveraged products tied to Samsung, SK Hynix and other AI-linked shares. Similar swings spilled into crypto-linked markets earlier this month when Trade.xyz compensated SK Hynix traders following a 19% mark-price dislocation.
Nikkei Drops As Asian Tech Weakness Spreads
The selloff extended beyond Seoul. Japan’s Nikkei 225 fell about 2.6% to 65,703.78, while Taiwan’s Taiex dropped 1.4% and Hong Kong’s Hang Seng declined about 0.4%.
Rising global bond yields and higher oil prices added pressure to technology valuations alongside renewed concerns over AI-sector pricing. U.S. semiconductor weakness provided the immediate catalyst after South Korean stocks had rallied for six consecutive sessions through Tuesday.
The KOSPI remained about 5.2% lower at 6,515.97 later Wednesday morning after recovering from its early decline of more than 6%.
