[Anchor]

The KOSPI briefly broke through the 6,000 mark during trading. Fears that Chinese semiconductor companies are within striking distance, combined with expectations that prolonged high interest rates could dampen AI investments, led to a plunge in semiconductor shares.

Reporter Lee Seong-hoon has the details.

[Reporter]

Starting more than 3 percent lower, the KOSPI rapidly expanded its losses, dropping to the 5,900 range at one point during the session.

It ultimately closed down 348 points, or 5.46 percent, at 6,035, barely managing to defend the 6,000 threshold.

The two tech heavyweights, Samsung Electronics and SK Hynix, dragged down the index by plunging over 7 percent and 10 percent, respectively.

Due to the sharp decline in large semiconductor stocks, a sell-sidecar was triggered in the morning, suspending program sell orders for five minutes.

This is the first time in about two months since August 19.

Foreign investors net sold more than 4.5 trillion won yesterday (October 13), extending their selling streak for the sixth consecutive trading day.

Having fallen for five straight trading days starting from October 6, the KOSPI saw its total market capitalization drop below 5 trillion won.

Behind the market plunge was the fear of China's technological catching-up in semiconductors.

Chinese memory chipmaker ChangXin Memory Technologies (CXMT) unveiled its achievements in developing next-generation DRAM technology and announced plans to release server products within this year.

Fears over intensifying memory competition and falling prices swept the market, with Japanese memory firm Kioxia also plummeting by 13 percent.

[Park Sang-hyun / Senior Analyst at iM Securities : The stimulation of fear over China's semiconductor rise had a quite significant negative impact on the semiconductor market conditions and stocks in the U.S. and broader Asian stock markets. The anxiety surrounding the semiconductor industry itself has further amplified foreign selling pressure….]

Anxieties over a potential slowdown in AI investments also weighed heavily.

As executives from Broadcom and Intel pointed to capital raising as the biggest constraint on the growth of the AI industry, forecasts resurfaced that the recent high-interest-rate environment would slow down investments.

As dampened investment sentiment stemming from the collapse of the two semiconductor giants spread across the entire stock market, the KOSPI faced a Black Tuesday.

(Video reporting: Shin Jin-soo, Video editing: So Ji-hye)