[Opning market] KOSPI Plunges Below 7500 on Semiconductor Sell-Off Amid Won Starting at 1,530 Per Dollar

The domestic stock market completely collapsed at the opening bell, unable to withstand the overwhelming shockwaves of an aggressive semiconductor-led sell-off triggered in the US New York stock market and the subsequent artificial intelligence risk stemming from China’s DeepSeek. As the two semiconductor giants, Samsung Electronics and SK Hynix, which account for an absolute majority of the market capitalization, spearheaded a simultaneous and precipitous plunge, the KOSPI index plummeted vertically below the 7,500 mark immediately after the opening.

On February 8 in the Seoul foreign exchange and stock markets, the KOSPI index opened at 7,452.48, crashing by 2.66% (203.49 points) compared to the previous trading day. With the lingering aftermath of the circuit breakers triggered during the previous trading session’s intensified selling frenzy yet to be fully resolved, the heavy downward pressure from the overnight crash of technology stocks and semiconductor indices in the New York market is being entirely transferred to the South Korean stock market in the early stages of trading.

The KOSDAQ index is also failing to escape the severe bearish trend. KOSDAQ started at 816.39, down 1.79% (14.88 points) from the previous trading day, and is rapidly accelerating its downward trajectory. The severe deterioration in investor sentiment across technology and growth stocks is dragging both the KOSPI and KOSDAQ markets into a deep swamp of stagnation.

Foreigners and Institutions ‘Dumping Growth Stocks’ vs Individuals Alone ‘Tearful Bargain Hunting’

The primary catalyst driving the stock market’s catastrophic crash in early trading today is the relentless and aggressive combined sell-off by foreign and institutional investors. In stark contrast, individual investors are absorbing the volume entirely on their own in a desperate attempt to build an upward support line, yet they are proving woefully inadequate to defend against the overwhelming bombardment of sell orders pouring in from institutions and foreigners.

Foreign investors are leading the devastating decline, recording a net sell-off of 420 billion won (about $274 million) immediately after the market opened. In alignment with the broader strategy to reduce the proportion of risk assets in their global portfolios, they are sharply expanding their massive dumping, primarily targeting the electrical and electronics sectors.

Institutional investors joined the foreign selling frenzy, relentlessly throwing 310 billion worth of shares into the market, spearheaded by Financial Investment and Investment Trust firms. The onslaught of selling is particularly concentrated on semiconductors and large-cap information technology items.

Conversely, individual investors stand alone in defending against the index crash, recording a dominant net purchase of 710 billion won. Although individuals, perceiving the steep stock price plunge as a short-term oversold phase, have aggressively stepped in for bargain hunting, the momentum of the sell-off is so immensely powerful that their defense of the index remains virtually negligible.

In the KOSDAQ market as well, foreign investors recorded a net selling of 110 billion won in early trading, violently slashing their holdings centered around top-tier biotechnology and secondary battery stocks. Institutional investors are also exerting severe downward pressure on the index by maintaining a net selling stance of 85 billion won. Individual investors are absorbing the sheer volume spat out by foreigners and institutions, fulfilling a net purchase of over 190 billion won in the KOSDAQ market.

Simultaneous Crash of Semiconductor ‘Top Two’… Top Market Cap Stocks Show ‘Blue Lights’ Across the Board

The catastrophic collapse of large-cap technology stocks, which market experts feared the most, has become a grim reality. Compounded by fears of Samsung Electronics’ slowing performance, the bearishness of US semiconductor stocks, and growing skepticism over global AI profitability triggered by DeepSeek’s technological assault have directly targeted and crippled the domestic semiconductor value chain.

The leading bellwether, Samsung Electronics, delivered a massive shock to the market by starting at 283,500 won, plunging 4.22% from the previous trading day. Despite positive internal news of labor-management agreements, such as the announcement of performance bonuses, the stock is hopelessly failing to overcome the colossal selling pressure fueled by concerns over the global industry outlook.

SK hynix, which was put to the test ahead of the monumental event of its American Depositary Receipt listing, opened at 2,093,000 won, a devastating 4.91% crash from the previous trading day. In spite of its monopolistic dominance in the High Bandwidth Memory market, it could not evade the brutal blade of the global tech stock multiple adjustment.

Representative secondary battery stocks such as LG Energy Solution (-1.85%) and POSCO Holdings (-2.10%) are also accelerating their relentless decline as the agonizing uncertainty surrounding US infrastructure and electric vehicle subsidy policies persists.

Samsung Biologics (-1.15%), Hyundai Motor (-1.42%), and Kia (-1.68%) all opened in the red as index-linked sell orders flooded the market due to the catastrophic index drop. Among the top 10 stocks by market capitalization in the KOSPI market, there is absolutely not a single stock showing an upward trend.

Won-Dollar Exchange Rate Pressured to Breach the 1,530 Won Mark… Fueling Stock Market Exodus

Coupled with the disastrous stock market crash, the won-dollar exchange rate is violently fluctuating once again in the Seoul foreign exchange market. This is the dire consequence of a massive money move toward the US dollar, the quintessential safe asset, as the crippling uncertainty in the global financial markets intensifies.

On this day in the Seoul foreign exchange market, the won-dollar exchange rate started trading at 1,530.0 won, surging by 8.5 won compared to the previous trading day’s closing price. A torrential flood of demand from foreign investors seeking to convert the funds from their dumped domestic stocks into dollars in early trading is aggressively fueling the exchange rate surge.

As the exchange rate threatens the 1,530 won mark, foreign investors’ fears of terrifying exchange rate losses have magnified, which is operating as a ‘vicious cycle’ that further incites the dumping of domestic stocks. Foreign exchange dealers forecast that the volatility of the won-dollar exchange rate will be utterly maximized for the time being, as the psychological resistance line collapses under the heavy weight of the US Federal Reserve’s prolonged high-interest-rate stance, the terrifying prospect of an all-out trade tariff war, and the impending deadline for the Korea-US trade negotiations.

Stock market experts uniformly agree that this catastrophic crash goes far beyond a simple technical correction and is the direct result of a complex interplay of profound uncertainties in the global macroeconomic environment.

An official from the securities industry analyzed, “The sudden plunge of the Philadelphia Semiconductor Index, including US-based Nvidia, has dealt a direct and devastating blow to Samsung Electronics and SK Hynix, the very brains of the domestic stock market,” adding, “As the terrifying pursuit by Chinese AI companies and the resulting ‘AI bubble theory’ resurface, a massive valuation rerating of technology stocks across the board is currently underway.”

Another expert offered a grim warning, “The terrifying fear that the won-dollar exchange rate could violently skyrocket into the mid-to-late 1,500 won range is completely dominating the market, making it an incredibly difficult time to expect the return of foreign investors from a supply and demand perspective.” The expert advised, “Because it is nearly impossible to reverse the index’s upward trajectory with the buying power of individual investors alone, it is absolutely imperative to prioritize risk management above all else and observe the market from a highly conservative perspective for the time being.”