[Edaily Reporter Shin Ha-yeon ] The domestic stock market retreated by more than 7% as it retreated under the impact of a U.S.-driven tech stock sell-off. Following the consecutive triggering of sell-side circuit breakers on the KOSPI and KOSDAQ early in the session, circuit breakers were also activated on both major markets in the afternoon as losses exceeded 8%. Although the markets recovered some of their losses after trading resumed, the KOSPI closed at the 5,500 level and the KOSDAQ at the 760 level as large-cap tech stocks, led by SamsungElectronics and SK hynix, plummeted.

According to MP Doctor on the 15th, the KOSPI closed at 5,554.22, down 454.59 points (7.57%) from the previous trading day. The index opened at 5,673.01, down 5.59% from the previous trading day, and plummeted to 5,450.81 during the session. Although it recovered some of its losses later, it ultimately closed down more than 7%. The intraday high was 5,751.45.

The KOSDAQ index also closed at 760.82, down 63.06 points (7.65%) from the previous trading day. The index, which opened at 784.45, fell as low as 745.43 during the session before partially recovering.

Market stabilizers were triggered repeatedly amid the sharp sell-off. At 12:23 p.m. that day, a Level 1 circuit breaker was triggered in the KOSDAQ market. At that time, the KOSDAQ index stood at 757.88, down 8.01% from the previous trading day. This was the fifth time this year and the 15th time since the system was introduced.

Subsequently, at 12:38 p.m., a Level 1 circuit breaker was also triggered on the KOSPI market. This measure was taken after the KOSPI fell to 5,528.05, down 8.00% from the previous trading day. This marks the 10th time this year and the 16th time overall that the KOSPI circuit breaker has been triggered.

A Level 1 circuit breaker is triggered when the index remains down more than 8% from the previous day’s closing price for one minute. When triggered, trading is suspended for 20 minutes, after which trading resumes following a 10-minute period of single-price trading. This is the first time circuit breakers have been triggered simultaneously in both major markets since July 29.

Prior to this, sell-side “sidecars” were triggered at 9:07 a.m. on the KOSPI market and at 9:12 a.m. on the KOSDAQ market. As the decline accelerated early in the session, the effectiveness of program sell orders was temporarily suspended, ultimately leading to the circuit breaker being triggered.

Massive selling by foreign investors weighed heavily on the KOSPI. On this day, foreign investors recorded net sales of 4.801 trillion won on the KOSPI. In contrast, retail investors and institutions absorbed the selling pressure with net purchases of 2.1682 trillion won and 1.963 trillion won, respectively. Program trading, combining arbitrage and non-arbitrage transactions, showed a net buying position of 265.6 billion won.

Most of the top market-cap stocks plummeted. SamsungElectronics(005930)closed at 210,000 won, down 9.48% from the previous trading day, while SK hynix(000660)closed at 1,262,000 won, plunging 11.06%. SamsungElectronics(1P)(005935)(-8.35%), SKSQUARE(402340)(-10.21%), LG Energy Solution(373220)(-4.62%), SamsungElectroMechanics(009150)(-15.36%), HyundaiMotor(005380)(-5.74%), and Samsung Life Insurance(032830)(-7.51%) also fell. In contrast, SAMSUNG BIOLOGICS(207940)showed strength, rising 5.50% to 1,247,000 won.

On the KOSPI, 805 stocks fell, while only 103 rose. Eight stocks closed unchanged, and two hit their daily upper price limit.

On the KOSDAQ, foreign investors made net purchases of 282.3 billion won. In contrast, retail investors and institutions made net sales of 124.8 billion won and 169.2 billion won, respectively. Program trading recorded a net buying volume of 227.2 billion won.

The sharp decline in the domestic stock market that day was directly influenced by the weakness in U.S. tech stocks overnight. Investor sentiment toward tech stocks deteriorated as the possibility of additional interest rate hikes by the Federal Reserve (Fed) came into focus due to stronger-than-expected U.S. inflation, coupled with growing concerns over the massive investment costs and funding burdens faced by artificial intelligence (AI)-related companies. Domestically, the impact was concentrated on semiconductor stocks—which had recently led the market—leading to an expansion of selling pressure from foreign investors.

The market is weighing the possibility that high volatility will persist for the time being. Kim Seong-geun, an analyst at MIRAE ASSET SECURITIES, stated, “High volatility is expected to continue for the time being,” adding, “With domestic supply-and-demand conditions weakening and the external environment unlikely to improve in the short term, it is necessary to closely monitor changes in the macroeconomic environment and corporate earnings.”

In particular, the sustainability of the AI investment cycle and the funding environment for related companies were identified as key variables that will determine the future direction of the stock market. The explanation is that, as AI-related investments continue, it is essential to assess whether revenue growth can keep pace with the accelerating rate of investment spending.

Analyst Kim noted, “The emergence of potential competitors in the domestic semiconductor sector is also weighing on investor sentiment,” adding, “While we should first monitor the intensity of foreign selling and changes in earnings estimates, if the environment stabilizes with gradual improvements in AI revenue growth and cash flow, the appeal of lower valuations may come to the fore.”