Kospi Falls More Than 9% as Samsung and SK Hynix Shares Drop
Key Takeaways
- •Samsung Electronics fell about 12% and SK Hynix dropped about 12.7%, heavily weighing on the Kospi because of their large index weightings.
- •The Kospi briefly sank 10.5% to 6,051.19, its weakest level since April, before trading restrictions were triggered.
- •Investors grew more cautious about whether AI-related capital spending and chip demand can keep rising at the pace seen during the recent rally.
- •Concerns increased that expanding Chinese chip production could pressure prices, margins, and the market share of established memory chipmakers.
- •CXMT raised at least $8.6 billion in its Shanghai STAR Market IPO, with its shares surging about 466% on debut.
South Korea’s Kospi fell more than 9% on Tuesday as investors sold semiconductor shares amid growing doubts about the durability of artificial intelligence spending. The selloff hit chipmakers hardest during the session and quickly rippled through a market where a small number of large technology names carry significant influence.
At its lowest point, the Kospi dropped 10.5% to 6,051.19, its weakest level since April. The decline was severe enough to trigger temporary trading restrictions, underscoring how sharply sentiment shifted during the session.
How Samsung and SK Hynix Drove the Decline
Samsung Electronics shares fell about 12%, while SK Hynix dropped around 12.7%. The two chipmakers make up a large share of the benchmark’s weighting, giving their declines an outsized effect on the Kospi and the broader South Korean market.
Semiconductor stocks had risen during the AI investment boom, as technology companies poured capital into data centers, servers, and advanced computing systems.
Investors later became cautious about the high valuations associated with that rapid expansion. They also questioned whether spending and chip demand could continue at the same pace, particularly in a sector where expectations for AI-related infrastructure had already driven a strong rally.
Concerns were further amplified by competition from Chinese AI companies and chipmakers. Investors worried that higher Chinese production could pressure prices and profit margins, while also reducing the global market share of established producers.
CXMT’s $8.6 Billion IPO Added to Market Concerns
Attention turned to ChangXin Memory Technologies after the company began trading in Shanghai. CXMT shares surged about 466% in their first session, and the company raised at least $8.6 billion through its STAR Market IPO.
Chinese chipmaker CXMT soars almost 500% in market debut — Financial Times (@FT) July 27, 2026
Chinese chipmaker CXMT soars almost 500% in market debut
CXMT makes dynamic random access memory chips used in phones, computers, servers, and AI machines. Samsung Electronics, SK Hynix, and Micron Technology are among the leading players in the global DRAM market. CXMT’s growth has raised expectations that it could become a more formidable competitor.
The Kospi selloff also came amid a broader decline across Asian markets. Japan’s Nikkei 225 fell 4% to close at 62,343, while Taiwan’s Taiex declined 3.9% and the Shanghai Composite lost 1%, according to Google Finance.
Hong Kong’s Hang Seng also moved lower, although the drop was smaller. The declines showed that pressure on technology stocks extended beyond South Korea and affected several major Asian markets on Tuesday, adding to a regional pullback in names tied to chips and AI infrastructure.
The sharp fall in the Kospi reflected a quick shift in sentiment toward AI-related stocks. Market participants continued to weigh high valuations against strong long-term demand for memory chips and computing infrastructure, while capital spending and Chinese competition remained central concerns.