The KOSDAQ index plunged to the 730s on May 21, reversing an early gain as foreign and institutional investors sold heavily. The index opened at 750.07, up 0.43 points (0.06%), but by 9:10 AM had fallen to 731.88, down 17.76 points (2.37%) from the previous session. Foreign investors net sold 26.9 billion won while institutions offloaded 5.9 billion won, overwhelming retail buying of 31.1 billion won. The decline occurred despite a rebound in US semiconductor stocks overnight, as escalating US-Iran tensions and rising international oil prices weighed on investor sentiment. The KOSPI index traded around the 6,500 level as markets navigated mixed domestic and external factors affecting Korean stocks.
Foreign and Institutional Selling Drives KOSDAQ Below 740
Foreign investors and institutions led the selloff on the KOSDAQ on May 21. According to the Korea Exchange, foreign investors net sold 26.9 billion won while institutions sold 5.9 billion won. Retail investors bought 31.1 billion won but could not offset the institutional outflows. Among top market-cap stocks, Alteogen fell 3.53%, EcoPro BM declined 2.21%, EcoPro dropped 2.18%, and Jusung Engineering decreased 2.26%. HLB rose 0.16%, Padu gained 4.19%, and Simtech increased 0.20%.
US Semiconductor Stocks Rebound Fails to Lift Korean Tech Shares
US technology stocks showed strength overnight, with buying flowing into semiconductor names. NVIDIA rose 0.23% and Micron Technology gained 1.94%. The Philadelphia Semiconductor Index climbed 0.60%, marking its first rebound in four trading sessions. However, the KOSDAQ showed little sign of recovery despite the positive US market performance.
Trump Warning and Oil Price Surge Add Geopolitical Pressure
Intensifying conflict between the US and Iran increased geopolitical anxiety across markets. US President Donald Trump posted on Truth Social: "For every American soldier killed by Iran, they will pay many times over," escalating tensions with his retaliation warning. Yemen's pro-Iran Houthi rebels declared a maritime blockade against Saudi Arabia, pushing international oil prices higher. These geopolitical developments weighed on overall market sentiment.
KOSPI Hovers Around 6,500 as Investors Assess Direction
The KOSPI halted its sharp decline and searched for direction on May 21. At 9:10 AM, the index stood at 6,461.68, down 54.59 points (0.84%) from the previous session. The index opened at 6,553.88, up 37.61 points (0.58%), and fluctuated around the 6,500 level. Retail investors net bought 210.7 billion won while institutions and foreign investors sold 21.1 billion won and 14.3 billion won respectively. Among top stocks, Samsung Electronics rose 1.02% and Samsung Biologics gained 1.49%, while SK Hynix fell 0.62%, SK Square dropped 0.85%, Samsung Electro-Mechanics declined 0.94%, and Hyundai Motor fell 3.51%.
FAQ
Why did the KOSDAQ fall on May 21 despite opening higher?
The KOSDAQ opened up 0.43 points at 750.07 but reversed to 731.88 (down 2.37%) by 9:10 AM due to heavy selling by foreign investors (26.9 billion won) and institutions (5.9 billion won). Geopolitical tensions from US-Iran conflict and rising oil prices pressured sentiment despite retail buying of 31.1 billion won.
How did US semiconductor stocks perform overnight compared to Korean tech shares?
US semiconductor stocks rebounded overnight, with NVIDIA up 0.23%, Micron Technology up 1.94%, and the Philadelphia Semiconductor Index rising 0.60% after four sessions of decline. However, the KOSDAQ showed no significant recovery, with major tech stocks like Alteogen (-3.53%) and EcoPro (-2.18%) declining on May 21.
What geopolitical factors affected Korean stocks on May 21?
US President Donald Trump warned on Truth Social that Iran would "pay many times over" for every American soldier killed, escalating US-Iran tensions. Yemen's pro-Iran Houthi rebels declared a maritime blockade against Saudi Arabia, driving international oil prices higher. These developments added downward pressure on Korean stock markets.
