South Korea’s stock benchmark dived almost 9% on Monday, tripping circuit breakers, after robust U.S. jobs data fanned bets on a Federal Reserve rate hike this year and sparked a rout in the tech-heavy market that had led the broader AI-rally.
The KOSPI fell as much as 8.8% in early trade, as chip heavyweights Samsung Electronics and SK Hynix dropped more than 10% each.
Circuit breakers were activated at 0003 GMT, halting trading for 20 minutes for the first time in three months. It was the third time they were triggered this year, and the ninth in history.
Another “sidecar” trading curb was activated as soon as circuit breakers were lifted, cutting the KOSPI’s losses to 4.6% as of 0039 GMT.
On Friday, the Nasdaq fell 4.2% after strong payrolls data killed any hopes of further interest rate cuts, while the Philadelphia Semiconductor Index slumped 10% and iShares MSCI South Korea ETF plunged 14%.
“A surprise in U.S. employment data triggered bond yield rises and provided an excuse for correction in an overheated market amid accumulated pressure from the surge in semiconductor stocks,” said Han Ji-young, an analyst at Kiwoom Securities.
“Increased volatility is inevitable, but it is unlikely that the rout will go on for several days, given that the KOSPI’s valuation pressure has been lowered by recent correction and earnings momentum remains robust for semiconductor stocks,” Han said.
Foreigners were net sellers of local shares worth 200 billion won ($128.86 million), extending their selloff to 21 consecutive sessions.
Despite Monday’s losses, the KOSPI is up 83% year-to-date. In 2025, it rose 76% for its biggest gain since 1999 and the top performance among major global markets last year.
The won was up 0.4% on Monday at 1,552.4 per dollar, after hitting its weakest level since March 2009 at 1,615.0 per dollar on Friday, prompting authorities to hold an emergency meeting on Sunday in which they pledged stern action against any speculative trading.