KOSPI fell 682.59 points (10.10%) to 6,073.16 as of 1:10 PM, threatening to break below the 6,000 level after plunging over 10% intraday. The sharp decline resulted from accumulated negative factors including concerns over semiconductor leaders' earnings slowdown and US Treasury yield pressures. Securities industry analysts characterized the selloff as driven more by psychological fear than short-term fundamental deterioration, identifying initial support around the 5,000 level.
Foreign Investors Sell Over 3.2 Trillion Won as Semiconductor Stocks Collapse
Foreign investors net sold over 3.2 trillion won in the securities market, dragging down the index. Leading stock Samsung Electronics plummeted 12.50%, while SK Hynix crashed 13.41%. Semiconductor and component stocks across the board suffered heavy selling, with SK Square falling 15.05%, Samsung Electro-Mechanics dropping 15.62%, and LG Innotek declining 16.29%. KOSDAQ also recorded a 7.55% decline to 707.09.
Sangsangin Securities Analyst Attributes Decline to Delayed Reflection of Negative Factors
Baek Young-chan, Head of Sangsangin Securities Research Center, stated in a call with Yonhap Infomax that "the current market has moved beyond the question of cheap or not cheap—it's at an inflection point." He noted that while semiconductor companies' earnings themselves will continue, concerns about AI industry growth are significantly impacting the market, particularly regarding delayed US data center construction.
Baek explained that "even as US 10-year Treasury yields rose to around 5% and Middle East geopolitical risks continued, the stock market rose without properly reflecting these factors," adding that "the depth of the correction has deepened as the market digests accumulated negative factors all at once." He assessed that the stock price collapse reflects shaken confidence in next year's earnings rather than this year's, stating "Samsung Electronics and SK Hynix's earnings forecasts for this year remain intact, but anxiety about next year's performance is being reflected in stock prices first." Baek pointed out that "to reverse the stock price decline, answers must come not from domestic companies but from big tech (hyperscalers)," meaning that verification of whether global AI companies' capital expenditures are proceeding without disruption is necessary to find rebound momentum.
Analyst Identifies PER 5x Support Level at 4,800-5,000 Range
Regarding the index bottom, Baek presented the 4,800-5,000 range, equivalent to a KOSPI price-to-earnings ratio (PER) of 5x. He stated "PER 5x based on this year's expected KOSPI corporate net income is around the 4,800-point level," adding "even considering the risk-free return environment with US Treasury yields at around 5%, the PER 5x support line remains valid. Initially, support will likely form around the 5,000 level."
For investor response strategies, he advised differentiated approaches based on return rates. Baek recommended that "investors who entered in the second half of last year or early this year and still maintain high returns of 50-100% or more would be better off securing cash by clearing some positions in preparation for possible delayed rebounds." However, he added that "investors who bought recently with minimal returns or losses need not participate in panic selling at this point," noting "there remains room for rapid rebounds if policy momentum emerges such as US data center-related legislation or economic stimulus measures, so it's time to calmly observe the market."
FAQ
What caused KOSPI stocks to fall over 10% intraday?
The decline resulted from accumulated negative factors including concerns over semiconductor leaders' earnings slowdown next year and US Treasury yield pressures around 5%. Foreign investors net sold over 3.2 trillion won, with Samsung Electronics falling 12.50% and SK Hynix dropping 13.41%.
Where does the analyst see support for KOSPI stocks?
Baek Young-chan of Sangsangin Securities identified the 4,800-5,000 range as initial support, corresponding to a price-to-earnings ratio of 5x based on this year's expected KOSPI corporate net income. He stated this support line remains valid even in the current 5% US Treasury yield environment.
