▲ The KOSPI closes down 360.42 points, or 5.98%, at 5,663.24 on the afternoon of the 29th, with the day's KOSPI index and SK Hynix stock price displayed at the Hana Bank dealing room in Jung-gu, Seoul.
Amid disappointment over SK Hynix's second-quarter earnings and conference call results, the KOSPI plunged sharply for the second consecutive day, with fear gripping the market over where the "true bottom" lies.
As recently as last week, the index had been seeking a rebound around the 6,800 level, but after shedding more than 1,000 points in just two days, the KOSPI—which once touched the 9,000 mark—now faces the prospect of having to find a new support level in the 5,000 range.
Following yesterday's historic crash, which marked a "Black Tuesday," the domestic stock market has faced yet another "Black Day."
According to the Korea Exchange and financial information service provider Yonhap Infomax today (the 29th), the KOSPI finished the session down 360.42 points (5.98%) at 5,663.24.
The tech-heavy KDAQ also closed down 43.17 points (6.12%) at 662.68.
Notably, following yesterday's events, sidecars restricting program selling were triggered in both markets, followed by circuit breakers that temporarily suspended trading for 20 minutes.
This marks the first time that circuit breakers have been simultaneously triggered for two consecutive days across both major indices representing the South Korean stock market.
The mood was not entirely unfavorable immediately after the opening bell.
Triggered by bargain hunting following yesterday's 10.84% plunge, the index started 1.09% higher at 6,089.11 and briefly climbed as much as 3.40% to 6,228.52, fueling expectations for a rebound.
However, the atmosphere changed abruptly after SK Hynix, which had initially surged over 4% following its record second-quarter earnings report, began rapidly giving up its gains.
SK Hynix posted a consolidated operating profit of 60.5426 trillion won for the second quarter of this year, up 557.2% from the same period last year, with an operating margin reaching a whopping 76%. However, this fell about 4.7% short of the market consensus of 63.5526 trillion won.
In particular, disappointment triggered a wave of dump-selling during the post-earnings conference call, as the company failed to disclose specific prices or details regarding ongoing negotiations for High Bandwidth Memory (HBM) and only stated that additional shareholder returns were under review.
As a result, SK Hynix plummeted as much as 19.61% during intraday trading, dragging the broader index down severely.
Samsung Electronics, which had shown relatively solid movement by rising over 6% right after the opening, was also caught up in the sentiment, plunging as much as 14.00% to 189,200 won during the session.
Samsung Electronics ultimately closed down 5.23% at 208,500 won.
With the top two heavyweights by market capitalization on the main bourse tumbling together, the KOSPI entered a steep downward spiral, sinking as low as 5,262.77—a 12.63% plunge—during the afternoon session.
This demonstrated that not only has the 6,000 line—previously considered the "true bottom" of the current correction—been completely shattered, but even the 5,000 level is now under threat.
Previously, global investment bank Goldman Sachs pointed to mechanical selling in single-stock leverage exchange-traded funds (ETFs) tracking Samsung Electronics and SK Hynix as problematic, designating the 6,800 level as the KOSPI's most critical technical support.
It analyzed that if the 6,800 level failed to hold, the next support would be 6,500, and breaking that could lead to a further retreat to the 6,100 to 6,000 range.
Morgan Stanley also presented a projected KOSPI range of 6,000 to 9,000 for the next three to six months in a recent report, and domestic securities experts predominantly viewed the 6,000 line as the floor.
Despite this, the breakdown of the 6,000 threshold and the necessity to seek a new bottom are attributed to anxieties sparked by China's ChangXin Memory Technologies (CXMT) successfully listing on the Shanghai Stock Exchange, Chinese state-owned enterprises developing deep ultraviolet (DUV) lithography equipment, and an extreme depletion of the fundamental strength of the South Korean stock market.
This follows a complete collapse in investment sentiment driven by ultra-high volatility, with circuit breakers being triggered six times across both the KOSPI and KOSDAQ markets in the month of July alone.
Kim Yong-gu, an analyst at Yuanta Securities, noted, "A market environment where remedies fail continues, as sentiment dominated by hazy pessimism overwhelms fundamentals armored with growth and visibility."
He particularly analyzed that amid the "wag-the-dog" phenomenon where single-stock leverage ETFs shake the entire index, a complex mix of factors is at play, including the global investment community's perception of a "Roller-KOSPI" and the stigma of the market resembling a gambling den.
Trading values for 16 single-stock leverage and inverse products tied to Samsung Electronics and SK Hynix exploded during today's crash.
The combined trading value of the 16 products reached 15 trillion won, roughly double the previous day's 8.2 trillion won.
However, Samsung Electronics and SK Hynix narrowed their losses to close out regular trading down 5.23% and 9.61%, respectively, allowing the KOSPI to recover toward its 200-day moving average near the 5,696-point mark.
In response, talk of a market bottom has begun to surface within the securities industry.
Lee Jae-man, an analyst at Hana Securities, stated, "Samsung Electronics' maximum drawdown (MDD) based on its closing price from its previous peak was -42.5%, while the MDD based on the intraday low was -47.8%. Considering that Samsung's stock price fell by an amount comparable to the global financial crisis (-46.7%), we judge that today's KOSPI intraday low of 5,260 is highly likely to be the bottom."
He added that the market capitalization of single-stock leverage ETFs for Samsung and SK Hynix—which have been singled out as the main culprits behind the amplified volatility—has dropped to an estimated 5.5 trillion won today, returning to levels seen right after their listing (5.2 trillion won), indicating that "extreme selling pressure on semiconductors is also passing its peak."
Meanwhile, the KOSPI's monthly drop for July stood at 33.18% as of today.
This marks a virtually unprecedented monthly decline, surpassing even the Asian financial crisis (IMF bailout) in October 1997 (-27.24%).
The KOSPI has fallen 39.66% from its all-time high of 9,385.59 recorded on June 19 of this year.
While its year-to-date return remains relatively high at 34.39%—having until recently ranked an overwhelming first among major economies—it has slipped to second place behind Taiwan (38.24%).
(Photo: Yonhap News)
※
Copying, redistribution, and unauthorized use in AI training are strictly prohibited.