SK hynix ADR Falls 1.86% as KOSPI Freezes on Back-to-Back Sell Sidecars; Can It Hold 6,000?

[Financial News] As concerns over an Artificial Intelligence (AI) bubble weighed on domestic and overseas markets, the New York stock market closed lower on the 20th local time. Despite a rebound in semiconductor stocks, gains were erased as tensions in the Middle East flared up again. SK hynix's American Depositary Receipt (ADR) also rose more than 4% at one point, but ended the session down 1.86%.
On Wall Street that day, the S&P 500 Index fell 0.19% from the previous session to close at 7,443.28. The Dow Jones Industrial Average (DJIA) dropped 0.59% to 51,839.26, while the NASDAQ Composite Index (NASDAQ), which is centered on technology stocks, ended the day down 0.05% at 25,508.072.
Domestic markets also fell sharply on the 20th. Sell sidecars were triggered for the second straight trading day in both KOSPI and KOSDAQ, temporarily suspending program sell orders. Investors are closely watching earnings announcements from major companies at home and abroad this week, including Alphabet, Google's parent company.
The KOSPI closed at 6,516.27, down 304.33 points, or 4.46%, from the previous session. Retail investors bought a net 351 billion won, and foreign investors bought a net 516.1 billion won. Institutions, however, sold a net 921.8 billion won. Compared with the all-time closing high of 9,114.55 on the 22nd of last month, the index has fallen 28.51%, putting it into bear market territory.
According to the Korea Exchange, a sell sidecar was triggered in the KOSPI market at 11:21 a.m. that day. It was the 20th sell sidecar this year. Including the 18 buy sidecars, which temporarily suspend program buy orders, the total number of sidecars triggered in the KOSPI market this year has reached 38.
Large-cap stocks also mostly weakened. Samsung Electronics fell 4.31% to 244,000 won, while SK hynix closed down 4.23% at 1.764 million won.
In the KOSDAQ market, a sell sidecar was triggered even earlier, at 10:52 a.m. It was the 11th this year. Including 13 buy sidecars, it was the 23rd sidecar overall. The KOSDAQ closed at 749.64, down 42.20 points, or 5.33%, from the previous session. Retail investors bought 190.8 billion won worth of shares, while foreign investors and institutions sold a net 57.7 billion won and 134.8 billion won, respectively.
As a result, investor sentiment toward semiconductor stocks also weakened. Last week, the Philadelphia Semiconductor Index fell more than 20% from its peak of 14,634.72 on the 22nd of last month, entering bear market territory. Concerns that the pace of AI investment could be slower than expected, combined with valuation pressure at recent highs, led to profit-taking in domestic semiconductor stocks.
Experts say earnings from big tech companies such as Alphabet could help ease concerns about excessive AI investment. Lim Jeong-eun, an analyst at KB Securities, said, "Earnings announcements from domestic companies are set to begin in earnest this week," adding, "In the United States, Alphabet is scheduled to report earnings, and it is necessary to check whether the current trend in capital expenditures (CapEx) for artificial intelligence will continue."
[email protected] Han Seung-gon Reporter