[Anchor]
The KOSPI, which had surpassed the 9,000-point mark, saw a sharp decline of nearly 10 percent yesterday, falling to the 8,200-point range. Leveraged products linked to Samsung Electronics and SK Hynix plunged by around 25 percent.
Reporter Lee Tae-gwon has the story.
[Reporter]
The KOSPI started slightly lower, climbed to 9,175 early in the session, but soon turned downward.
As the losses deepened, a sidecar was triggered, and in the afternoon, the index fell by more than 8 percent, leading to a circuit breaker that halted trading for 20 minutes.
Even after trading resumed, the index failed to rebound and eventually closed at 8,203, a plunge of nearly 10 percent.
This marks a 910-point drop, the largest in history in terms of point decline.
The number of sidecar triggers has reached 27 this year alone, surpassing the total record set during the 2008 global financial crisis.
Although individual investors were net buyers of over 8 trillion won, it was not enough to prevent the index from falling.
Amid growing expectations of a potential interest rate hike in the U.S., a sell-off centered on semiconductor stocks caused the index to collapse.
SK Hynix and Samsung Electronics both fell by 12 percent, closing at 2,555,000 won and 310,000 won, respectively.
Leveraged ETFs that reflect twice the daily fluctuations of these two stocks also plummeted by 24 to 26 percent.
Some point out that these leveraged products have amplified volatility during the sharp market correction.
The trading value of single-stock leveraged ETFs reached approximately 17.4 trillion won, accounting for one-third of the total KOSPI trading volume.
[Interview: Lee Jin-woo, Head of Research Center at Meritz Securities: There was fatigue from the market's rapid short-term gains, and as these factors overlapped and the scale of the correction grew, the impact was further magnified when leverage was concentrated in specific stocks.]
Financial authorities are monitoring the sharp market volatility caused by leveraged products and are exploring potential safety measures.
Options such as increasing the required deposit amount for leveraged product investments or strengthening investor education are being discussed.
(Video reporting: Lim Woo-sik | Video editing: Lee Seung-jin | Graphics: Kang Yoon-jung, Jang Chae-woo)
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