On the 28th, the domestic stock market showed a near-panic plunge immediately upon opening, leading to the consecutive triggering of sell-side sidecars and circuit breakers in both the KOSPI and KOSDAQ markets. Samsung Electronics and SK Hynix, the leading semiconductor stocks, recorded double-digit declines, driving the index's sharp drop.

Intensifying Fears of Chinese Semiconductor Competition as the Starting Point The trigger for this plunge is interpreted as growing concerns over the rise of Chinese semiconductors. Following the successful stock market listing of China's memory chipmaker Changxin Memory Technologies (CXMT), news emerged that China has begun developing deep ultraviolet (DUV) lithography equipment, a critical tool in semiconductor manufacturing, significantly shaking domestic and international semiconductor investor sentiment. As Korean semiconductor companies have enjoyed a premium based on their technological lead over China, China's indigenous equipment development served as a catalyst that heightened anxieties over a narrowing technology gap.

Additionally, the overnight weakness in U.S. semiconductor stocks spilling over into the domestic market also played a role. Previously, in the New York stock market, a sell-off centered around the semiconductor sector led the NASDAQ to be the only one of the three major indices to close lower. Combined with the China-related news, concerns over major domestic semiconductor stocks appear to have been further amplified.

KOSPI Circuit Breaker Triggered for the First Time in 10 Trading Days At 9:14 a.m. today, the 12th sell-side sidecar of the year was triggered in the KOSDAQ market. In the KOSPI market, a sell-side sidecar was triggered right after the opening, followed by a circuit breaker at 10:13 a.m. The circuit breaker activation marks the first in 10 trading days since the 13th and the 8th of this year.

A circuit breaker is a measure that halts all trading for 20 minutes if the KOSPI index falls 8% or more below the previous trading day's closing price for one minute. After the halt is lifted, trading resumes for 10 minutes under a single-price auction method.

The simultaneous decline of the two major large-cap stocks served as the direct factor dragging down the entire index. Samsung Electronics fell 9.25% from the previous day to 230,000 won, while SK Hynix plunged 11.07% to 1,616,000 won, shaking a combined market capitalization of around 1,151 trillion won. This impact spread throughout the semiconductor value chain, causing related stocks such as Samsung Electronics Preferred, SK Square, and Samsung Electro-Mechanics to show declines approaching double digits.

Individual Investors Fail to Defend Market Against Selling by Foreigners and Institutions Looking at supply and demand, as of 10:15 a.m., individual investors net purchased approximately 1.86 trillion won in an attempt to defend the index, but it was insufficient to stem the sell-off. Foreigners and institutions were recorded as net sellers of 1.7 trillion won and 148.2 billion won, respectively, pouring out volumes that exceeded individual investors' buying capacity.

Looking ahead, the market is expected to closely watch the U.S. Federal Open Market Committee's (FOMC) interest rate decision scheduled for this week, as well as the earnings announcements of domestic and international semiconductor companies, including SK Hynix. Whether the earnings results contain enough to alleviate the Chinese competition fears that sparked this plunge is cited as the key to a future rebound. Additionally, whether the selling intensity from foreigners and institutions continues into the latter half of the session, and whether the decline widens or narrows during the single-price auction following the circuit breaker lift, are variables to monitor.

[This article was written with the assistance of AI. This article is for informational purposes only and does not recommend the purchase or sale of any specific stock. Intraday stock prices and trading volumes are subject to continuous fluctuation.]