[Edaily Reporter kyoungeun kim ] The KOSPI plunged more than 5% amid negative news regarding artificial intelligence (AI) and memory chips, triggering a sell-side circuit breaker for the first time in two months. While the index fell below the 6,000 mark during the session before narrowly recovering on a wave of rebound buying, analysts suggest that a rotation toward non-semiconductor stocks may continue until confidence in the semiconductor sector is restored.

On the 13th, the KOSPI closed at 6,035.35, down 5.46% from the previous trading day, while the KOSDAQ closed at 837.03, down 1.43%. As the KOSPI fell below its 200-day moving average, selling pressure intensified, triggering the sell-side circuit breaker for the first time since August 19. In the stock market, foreign investors were net sellers by 4.533 trillion won, while retail and institutional investors were net buyers by 2.2361 trillion won and 1.6884 trillion won, respectively.

Kang Jin-hyuk, an analyst at Shinhan Investment Securities, stated in a report released after the market closed that day, “Although macroeconomic impacts were limited due to factors such as the U.S. bond market being closed overnight, negative news regarding AI worsened investor sentiment across the related value chain.” Phil

Researcher Kang cited two specific negative factors. He explained, “The CEOs of Broadcom and Intel pointed to capital raising as a constraint on AI growth and warned of uncertain returns,” adding, “News of Changxin Memory Technology (CXMT)’s launch of DDR5 for servers also fueled concerns about intensifying memory competition and profit erosion in 2027–2028, serving as a trigger for a sell-off.” He continued, “While verification—including actual mass production—will take time, foreign investors continued to sell off as doubts grew regarding the persistence of the bottleneck and whether the semiconductor market is truly cyclical—key arguments underpinning the sector’s strength.” Foreign investors have recorded net sales of 21.8 trillion won over 10 of the last 11 trading days. The futures market, however, has shifted to net buying.

The fact that share buybacks are nearing completion also exacerbated the decline. Analyst Kang analyzed, “Amid the absence of active buying by retail investors following the intense deleveraging in July, the impact of foreign selling is intensifying as share buybacks by major semiconductor companies reach their final stages.” SK hynix(000660) ’s share buyback program, totaling 600 billion won per day, is expected to conclude around this week. On this day, SamsungElectronics(005930)plummeted 7.4%, and SK hynix fell 10.1%.

However, the index managed to hold above the 6,000 mark. The KOSPI 200 Volatility Index (VKOSPI) approached 50 for the first time in about a month. Analyst Kang said, “Similar to the sell-off (correction) at the end of July, the index touched the 240-day moving average and the Relative Strength Index (RSI) entered oversold territory, after which rebound buying flowed in, allowing the index to barely hold onto the 6,000 level.” The 12-month forward price-to-earnings ratio (P/E ratio), based on the low point, stood at 4.5x, significantly below the late-July low of 5.3x.

Some stocks rose even amid the sharp market decline. Amid ongoing concerns about supply chain disruptions due to clashes between Houthi rebels and Saudi Arabia, HMM(011200)(1.2%) and PanOcean(028670)(1.6%) rose. Codes Combine Co.,Ltd.(047770)(0.6%), a stock tied to inter-Korean economic cooperation, also rose after U.S. President Donald Trump mentioned the possibility of North Korea-U.S. talks during his visit to Asia for the Asia-Pacific Economic Cooperation (APEC) summit in November. Kukje Pharma(002720), a vaccine stock, surged 15.4% after the World Health Organization (WHO) requested additional data regarding suspected cases of the Black Death in Russia.

Analyst Kang noted, “Although the Korean stock market had already factored in noise from OpenAI and CXMT the previous day, it suffered further declines today,” adding, “This appears to be a loss of confidence in the semiconductor sector rather than a deterioration in actual fundamentals; SamsungElectronics and SK hynix are also hovering around their 200-day moving averages.” He continued, “When it comes to earnings reports from major semiconductor companies—such as ASML on the 14th and TSMC on the 15th—we need to focus more on guidance than on short-term market conditions,” and predicted, “Rotational trading in non-semiconductor sectors is likely to continue until doubts about the semiconductor sector are resolved.”