‘Black Monday’ Hits Stock Market: KOSPI and KOSDAQ Plummet

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The KOSPI has plunged by over 8%, closing at the 7,400 level. A circuit breaker was triggered, halting trading for 20 minutes.

Here is the report by Baegun.

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The KOSPI, which began to widen its losses immediately after the opening bell, fell by more than 8% just three minutes into the regular trading session.

A circuit breaker was triggered, suspending trading for 20 minutes.

This marks the first time a circuit breaker has been activated in the KOSPI market in three months, since the outbreak of the Middle East war last March.

Although the KOSPI briefly narrowed its losses, it ultimately closed at 7,484, down 8.3%.

While individual investors net-purchased 1.7 trillion won, institutions and foreign investors net-sold 1.6 trillion won and 350 billion won, respectively, dragging down the index.

The ‘Black Monday’ in the stock market was triggered by concerns over U.S. monetary tightening and a sharp decline in semiconductor stocks.

Previously, robust U.S. employment data confirmed the possibility of interest rate hikes. Concerns that higher interest rates would dampen AI investments by major U.S. tech companies led to a drop of over 10% in the Philadelphia Semiconductor Index.

In the aftermath, Samsung Electronics fell by more than 10%, dropping below the 300,000 won mark, while SK Hynix also slid by over 7%, giving up the 2 million won level.

The KOSDAQ index also saw a circuit breaker triggered and plummeted by over 9%, falling below the 1,000-point mark.

[Kim Dong-won / Head of Research, KB Securities: The index has risen 100% this year. Because of that, the correction is deep and proceeding very steeply. Considering the gains made so far, it can be interpreted as a correction due to overheating.]

Following a 5% drop last Friday, the KOSPI’s sharp decline yesterday (June 8) has heightened concerns over losses for individual investors who borrowed money to invest aggressively.

With the balance of credit-based margin trading—money borrowed from brokerage firms to invest—nearing 38 trillion won, a significant drop in stock prices triggers forced liquidations of held shares.

The loss rate for single-stock leveraged ETFs, which have recently attracted significant capital, has neared 40% over the past three trading days.

[Kim Jae-seung / Analyst, Hyundai Motor Securities: In a situation where the proportion of high-risk investments is increasing, while some assets push prices up strongly when the market rises, they also cause prices to fall much faster when the market drops.]

Online, posts verifying losses have continued to appear, while some have expressed opinions that they would use the sharp decline as a buying opportunity.

(Reported by Baegun | Video by Kim Nam-sung and Kim Young-hwan | Video Editing by Kim Yoon-sung | Graphics by Park Tae-young)
※ Please note: This article was translated by AI and may contain errors.