Caution mounts ahead of ‘big event’... KOSPI falls below 5,500 for first time in six months

[Financial News] The KOSPI closed below the 5,500 mark for the first time in six months. Market caution mounted as geopolitical uncertainty grew ahead of major companies’ third-quarter earnings announcements and the U.S. Federal Reserve’s interest rate decision.
According to the Korea Exchange (KRX), the KOSPI ended trading on the 26th at 5,469.47, down 80.83 points (1.46%) from the previous trading day. It opened at 5,499.05, down 51.25 points (0.92%) from the previous session, and at one point fell as low as 5,455.11, a decline of 1.71%.
The last time the KOSPI closed below 5,500 was on April 7, when it ended at 5,494.78—six months ago. The index had managed to hold above 5,500 at the close even on July 30 (5,593.56), when volatility was extreme due to single-stock leveraged exchange-traded funds (ETFs), and even this month, as unease about the artificial intelligence (AI) industry grew.
Foreign investors’ net sales of 707.8 billion won on the main board deepened the decline. Institutions and individual investors, by contrast, net bought 604.4 billion won and 64.5 billion won, respectively, helping to cushion the fall. Other corporations net bought 37 billion won.
All of the top stocks by market capitalization fell in unison, with AI-related heavyweight stocks including Samsung Electronics (-1.16%), SK hynix (-0.16%), Samsung Electronics preferred shares (-2.20%), SK Square (-0.77%) and Samsung Electro-Mechanics (-0.36%) posting losses. LG Energy Solution (-2.09%), Samsung Biologics (-0.95%), Hyundai Motor (-2.54%) and KB Financial Group (-3.79%) also closed lower.
The deterioration in investor sentiment is seen as stemming from increased geopolitical uncertainty originating in the Middle East ahead of major companies’ earnings announcements and the Fed’s Federal Open Market Committee (FOMC) meeting.
SK hynix and Samsung Electronics are scheduled to announce their third-quarter results on the 28th and 29th, respectively. After its regular meeting on the 27th–28th (local time), the FOMC is expected to announce its benchmark interest rate around the early morning of the 29th Korea time.
However, Israel’s general election and the U.S. midterm elections are scheduled for the 27th and the 3rd of next month, respectively, local time. This has raised the possibility that the war in the Middle East could resume as a full-scale conflict around then.
Kang Jin-hyuk, a researcher at Shinhan Investment & Securities, said, “AI-related concerns remain, and inflation worries are emerging, while the KOSPI awaits events such as earnings announcements and the FOMC.” He added, “Fears of an all-out war with Iran are growing ahead of Israel’s general election, and global oil prices remain high.”
The KOSDAQ closed at 727.21, down 24.28 points (3.26%) on the day. The last time it closed below 730 was on July 31, when it ended at 719.76—about three months ago. The KOSDAQ opened at 742.17, down 9.52 points (1.27%) from the previous trading day, and its losses widened.
Institutions were the sole net sellers on the KOSDAQ, selling 127.8 billion won. Individual and foreign investors net bought 85.4 billion won and 39 billion won, respectively.

[email protected] Im Sang-hyeok Reporter