KOSPI Plunges Amid 'Blue Tsunami': Foreign Investors Offload Shares

[Anchor]

As the Democratic Party's landslide victory in the U.S. midterm elections created a so-called "blue tsunami," the South Korean stock market turned sharply lower today (Nov. 5). With significant impacts expected across the South Korean economy, starting with semiconductors, the KOSPI plummeted by more than 5%. Tonight's 8 O'Clock News will take an in-depth look at how far the fallout from the U.S. midterms will spread.

First, we have a report from reporter Lee Seong-hoon.

[Reporter]

The massive tsunami of the U.S. Democratic landslide swept through the domestic stock market.

The KOSPI tumbled by over 5% to sink below the 5,300 level, hitting a seven-month low.

The KOSDAQ also gave up the 700 mark.

Sell sidecars were triggered in both the KOSPI and KOSDAQ markets.

Samsung Electronics briefly slumped to 190,000 won during trading before barely defending the "200,000-won Samsung" threshold, while SK Hynix also plunged by more than 9%.

Selling pressure from foreign investors was fierce, particularly targeting large-cap semiconductor stocks. Foreigners offloaded nearly 3.4 trillion won worth of shares in the main bourse alone.

Foreign investors have dumped nearly 6 trillion won worth of stocks over yesterday and today, with Samsung Electronics and SK Hynix accounting for nearly 80% of that total.

The primary reason is that the Democratic Party, which won a landslide victory, has shown signs of moving to tighten regulations on the construction of AI data centers due to massive power consumption and environmental concerns, unlike the Trump administration.

Even before these measures have become reality, shares of semiconductor and power equipment companies were crushed by panic.

[Park Sang-hyun / Researcher, iM Securities: As various countries invest in AI, GPUs are actually in short supply. Therefore, the possibility that overall demand for GPUs and South Korea's semiconductors will plummet sharply just because data center spending has decreased slightly is quite low...]

Defense stocks also fell across the board on prospects that the U.S. could end the war in Iran, while analyses suggesting that oil prices could drop dragged down the share prices of refiners.

Conversely, expectations that tariff pressures might ease pushed Hyundai Motor and Kia up by around 3% and 5%, respectively.

(Photo: Yonhap News) (Video by Park Hyun-chul, Video Editing by Park Ji-in)
※ Please note: This article was translated by AI and may contain errors.