South Korean stocks suffered another steep sell-off on Monday after foreign investors pulled billions of dollars from the market. Concerns also grew about the sustainability of the country's
South Korean stocks suffered another steep sell-off on Monday after foreign investors pulled billions of dollars from the market. Concerns also grew about the sustainability of the country's AI-driven semiconductor rally.
The benchmark KOSPI dropped 3.65% on Oct. 12 to close at 6,384.24, its lowest close since Aug. 11. The decline extended the index's losing streak to four consecutive sessions, during which it has fallen 8.85%.
<iframe src=”https://widgets.coincodex.com/w/90bfddbb-4b58-4c83-9645-3941d866c61a?site=coinpaper&mode=light” width=”100%” height=”420” frameborder=”0” referrerpolicy=”no-referrer-when-downgrade” style=”border:0;background:transparent;border-radius:0px;”></iframe>The technology-heavy KOSDAQ performed even worse, and fell 4.83% to 849.19.
Samsung and SK Hynix Lead South Korean Stock Sell-OffSome of South Korea's biggest technology companies were at the center of Monday's downturn. Samsung Electronics shares fell 4.39%, while AI memory-chip leader SK Hynix dropped 4.52%. SK Square plunged 6.10%, while Hyundai Motor, Samsung Biologics and LG Energy Solution also finished lower.
The declines came despite continued strength in the semiconductor sector's underlying earnings.
Samsung is expected to report a dramatic year-over-year increase in third-quarter operating profit, fueled partly by strong demand for chips used in AI infrastructure. However, analysts recently reduced earnings forecasts as the pace of memory-chip price increases begins to slow.
That has contributed to questions over whether the enormous gains enjoyed by South Korean semiconductor stocks can continue.
AI Fears and Oil Prices Add to Market PressureThe sell-off comes as investors reassess valuations in the global AI trade. South Korea has been one of the biggest beneficiaries of booming demand for memory chips used in AI data centers, which helped push the KOSPI sharply higher earlier this year.
However, concerns about semiconductor profitability and the durability of the memory-chip upcycle are now weighing on sentiment.
Rising oil prices and new Middle East tensions added another source of uncertainty. Higher energy costs could keep global inflation elevated and put even more pressure on interest rates, creating a tougher environment for highly valued technology stocks.
Despite the recent downturn, South Korean stocks are still much higher for 2026. The latest slide is therefore a sharp reversal from one of this year's strongest global stock-market rallies rather than a complete erasure of those gains.
