Kospi falls 5.5% in Seoul trading as a selloff in semiconductor shares pulled South Korea’s benchmark index below the 6,000-point level on Tuesday, October 13, 2026. The index closed at 6,035.35, down 5.46%, after recovering some losses in the afternoon.
Samsung Electronics and SK hynix fell about 7% and 10%, respectively, at the close, according to Bloomberg. Foreign investors sold a net 2.2 trillion won (about $1.5 billion) worth of Kospi shares on Tuesday, bringing their net selling this month to nearly 8 trillion won.
What triggered the selloff as Kospi falls 5.5%
Several pressures converged. The decline followed overnight weakness in US technology stocks. Local reports also pointed to an announcement by China’s memory maker CXMT. The company said it had made progress in DRAM technology, and news that server memory products using it could reach the market later this year fueled concern about tighter competition in global memory supply.
A second concern was the valuation of AI-related stocks. CoinDesk reported that comments by Broadcom CEO Hock Tan, who likened speculative AI investing to gambling according to the Financial Times, added to the pressure. HCN has not independently reviewed the original remarks.
Trading curbs and the scale of the drop
The Kospi fell more than 7% at one point, Bloomberg reported. The Korea Exchange suspended program sell orders at 9:47 a.m. after Kospi 200 futures fell 5.08%. This measure, known as a sell-side sidecar, pauses one type of automated selling for a short time. It is not a halt to all trading. It was the first such trigger in nearly two months.
The index has lost more than 1,000 points over five trading sessions, retreating from above 7,000. The market remains well above where it began the year. The Kospi was up 51% in 2026 as of Monday’s close, compared with a gain of more than 70% for Taiwan’s stock market.
Why Korea is so exposed
Samsung Electronics and SK hynix carry heavy weight in the index. One European financial outlet reported that the two together account for more than half of the Kospi’s market value. That concentration means a selloff in memory chips can move the whole market, as it did on Tuesday.
CXMT is still a smaller player. Counterpoint Research estimated that CXMT held 8% of global DRAM revenue in the first quarter, behind Samsung at 38%, SK hynix at 29% and Micron at 22%. Analysts disagree on how serious the threat is. SemiAnalysis found that CXMT’s average selling prices in the first quarter were only 5% to 10% below those of its larger rivals, a narrower gap than the “half price” claims in some earlier industry reports. CXMT’s claimed technical progress has not been independently confirmed.
Spillover after the Kospi falls 5.5%
The losses spread across Asia. Taiwan’s Taiex and Japan’s Nikkei 225 each fell nearly 2%, Bloomberg reported. In US trading, Micron fell 4.9% and Applied Materials 6.5% by midday. By the close, the damage to US indexes was limited. The Philadelphia Semiconductor Index ended down 0.23%, and the Nasdaq Composite lost 0.15%.
Who is affected
Korean media said individual investors had been buying through the recent decline. KED Global reported on Monday that buying by individual investors was being overwhelmed by foreign selling. Because the Kospi is a widely tracked benchmark, sharp swings can affect household investors and funds that hold Korean equities. HCN has not found data on how many individual investors were affected on Tuesday.
What remains unclear
No official statement from the Korean government, Samsung Electronics or SK hynix on Tuesday’s decline was found in the sources reviewed. Analysts are watching whether foreign selling continues. Han Ji-young, an analyst at Kiwoom Securities, identified the Kospi’s 200-day moving average as a key technical support level and said CXMT concerns and US chip weakness were amplifying volatility. The next test comes with Wednesday’s session in Seoul. It will show whether the partial afternoon recovery holds or whether the five-day slide extends.