[Edaily Reporter Kim Hyung-il ] The KOSPI is down more than 2% in early trading. Although retail investors have been buying on the dip, continued selling by both foreign and institutional investors is weighing on KOSPI blue-chips as well as stocks related to secondary batteries and semiconductors. While semiconductor stocks rebounded on U.S. markets, concerns over the financial burdens facing artificial intelligence (AI) infrastructure companies and caution surrounding Big Tech earnings reports appear to be weighing on the domestic stock market.

According to MP Doctor on the 20th, as of 9:18 a.m., the KOSPI stood at 5,632.85, down 135.16 points (2.34%) from the previous trading day. The KOSPI opened at 5,733.57, down 34.44 points (0.60%), and has since extended its losses. The KOSDAQ index fell 13.83 points (1.71%) to 795.06. The KOSDAQ also opened at 805.37, down 3.52 points (0.44%), before the decline widened.

On the KOSPI, the decline in large-cap stocks was particularly pronounced. The large-cap index fell 2.46%, while the mid-cap and small-cap indices dropped 1.39% and 1.04%, respectively. The decline in the index appeared relatively steep as selling pressure was concentrated primarily on large-cap stocks. By sector, transportation equipment and parts recorded the largest drop, falling 3.82%. Machinery and equipment (-3.33%), metals (-3.18%), medical and precision instruments (-2.86%), and chemicals (-2.83%) also showed weakness.

Among the top market-cap stocks, SamsungElectronics(005930)is trading at 215,500 won, down 1.15%. SK hynix(000660)is trading at 1,228,000 won, down 3.84%, and SKSQUARE(402340)is also down 3.72%. LG Energy Solution(373220)and SamsungElectroMechanics(009150)fell 2.43% and 2.05%, respectively. In contrast, SAMSUNG BIOLOGICS(207940)rose 0.14%. Large-cap semiconductor stocks and rechargeable battery-related stocks are showing weakness in tandem, increasing downward pressure on the index.

On the KOSDAQ, the weakness in secondary battery stocks and semiconductor equipment stocks was particularly pronounced. ECOPRO BM CO., LTD.(247540)fell 5.44%, and ECOPRO CO., LTD(086520)also dropped 4.42%. Semiconductor equipment stocks such as JUSUNG ENGINEERING Co.,Ltd.(036930)(-3.82%) and WONIK IPS Co.,Ltd.(240810)(-3.13%) also showed weakness. By sector, the financial sector (-3.07%), medical and precision equipment (-2.92%), and non-metals (-2.23%) saw the sharpest declines. The downward trend was evident across the top KOSDAQ market-cap stocks and major sectors, reflecting a contraction in investor sentiment.

In terms of supply and demand, retail investors were net buyers, while foreign and institutional investors were both net sellers. As of 9:22 a.m., retail investors were net buyers of 732.2 billion won on the KOSPI and 224.9 billion won on the KOSDAQ. In contrast, foreign investors were net sellers of 415.6 billion won on the KOSPI and 166.3 billion won on the KOSDAQ. Institutions also showed a net selling position of 350.7 billion won on the KOSPI and 58.1 billion won on the KOSDAQ. Although retail investors stepped in to buy during the downturn, their efforts appeared insufficient to absorb the selling pressure from foreign and institutional investors.

Earlier, U.S. stock markets showed mixed performance, buoyed by positive sentiment toward the AI infrastructure sector and bargain-hunting. On the 19th (local time), the Dow Jones Industrial Average fell 0.1%, while the S&P 500 rose 0.4% and the Nasdaq rose 1.1%. The Philadelphia Semiconductor Index also rose 1.6%. Semiconductor-related stocks performed strongly, with NVIDIA up 1.4% and Micron and SanDisk rising 3.0% and 5.5%, respectively. However, concerns remain that expanded investment in AI infrastructure could lead to increased debt burdens and higher financing costs for companies.

This week, U.S. Big Tech companies, starting with Meta, are scheduled to report their earnings. Market attention is inevitably focused on whether AI investments are translating into actual revenue and profits. If the payback period for large-scale data center investments lengthens or financing costs rise, the financial burden on AI infrastructure companies could come into sharper focus. Consequently, stock price volatility for related stocks may increase around the time of the earnings announcements.

Han Ji-young, an analyst at KIWOOM Securities, noted that with U.S. Big Tech earnings reports on the horizon, lingering market concerns about the financial burdens facing AI infrastructure companies could lead to continued volatility in the domestic stock market. However, she noted that perceptions of oversold conditions following the recent sharp decline and easing valuation pressures could serve as factors encouraging bargain hunting. She explained that investors should not only take short-term positions in sectors that have been oversold—such as semiconductors—but also broaden their investment scope to non-semiconductor sectors where earnings outlooks are improving.

Researcher Han stated, “At this point, it is reasonable to set the recovery from last week’s sharp decline as the base scenario,” adding, “While taking short-term positions in oversold sectors such as semiconductors, it is also necessary to expand interest to non-semiconductor sectors with strong earnings momentum.”