In just two trading days, South Korea’s KOSPI index shed a staggering 864.5 trillion won, triggering emergency meetings and circuit breakers that halted trading twice. On July 28 and 29, the market’s steep plunge wiped out massive value, leaving investors shaken and authorities scrambling for solutions.

The KOSPI closed at 5,663.24 on July 29, down nearly 6% from the previous day. This marked the second consecutive day that the market-wide circuit breaker was triggered, an unprecedented move highlighting the severity of the selloff. Officials from the Financial Services Commission, Bank of Korea, and Financial Supervisory Service held an emergency meeting led by Finance Minister Koo Yun-cheol to discuss the turmoil.

Lawmakers pointed to a surge in single-stock leveraged products launched in May as a catalyst for the volatility. These ETFs funneled speculative bets into a handful of blue-chip stocks, amplifying price swings far beyond global counterparts. Minister Koo acknowledged this factor but stressed it was one among several causes. He promised further measures if needed to stabilize the market.

The selloff intensified after SK Hynix reported record quarterly revenue but missed analyst forecasts, dragging its shares down 9.6%. Despite a 257% revenue jump year-over-year, the semiconductor giant’s operating profit fell short of expectations, amplifying investor jitters. Samsung Electronics also suffered, with shares down 5.2% and a loss of over 35% in the past month.

Over the two days, the KOSPI lost 1,092 points, with market value dropping 600 trillion won on July 28 and an additional 264 trillion won on July 29. The Korean Exchange was forced to halt trading each day, an indication of extreme market instability. The sharp declines contrast sharply with the broader global markets and shows the heavy impact of concentrated speculative trading.

SK Hynix’s earnings miss amid strong AI chip demand shows how even solid fundamentals can be overshadowed by volatile investor sentiment. Meanwhile, concerns ripple through South Korea’s financial landscape as authorities weigh further interventions to cool the market.

This information is for educational purposes and does not constitute financial advice.