KOSPI Plummets: Are Meta's Cloud Plans Behind the Tech Sell-off?

The KOSPI has plummeted, impacted by the weakness of U.S. tech stocks overnight.

Foreign selling has continued for 10 consecutive trading days, dragging down the index.

As of 10:40 a.m. today (July 2), the KOSPI is down more than 3% from yesterday, hovering in the low 8,000 range.

The index fell below the 8,000 mark during intraday trading for the first time in 15 trading days since June 11. Amid the sharp decline, a sell-side circuit breaker was briefly triggered, temporarily suspending program trading orders.

The slump is being driven by sharp declines in so-called KOSPI bellwethers Samsung Electronics and SK Hynix, with analysts pointing to U.S. tech giant Meta’s announcement of its entry into the cloud business as the cause.

Bloomberg reported that Meta has launched an internal project called Meta Compute, which aims to develop a cloud business model utilizing its own data center infrastructure.

This means the company intends to sell its surplus computing resources to external parties.

As this news spread, it sparked concerns that AI computing resources might be heading toward an oversupply, dealing a blow to the semiconductor sector, which had been enjoying a boom due to price hikes driven by supply shortages.

Overnight on the New York Stock Exchange, related companies saw significant drops, with Micron Technology falling more than 10% and Intel sliding 9%.

Industry experts believe that Meta, one of the so-called hyperscalers that have led the AI investment cycle and driven semiconductor earnings growth through rising memory prices, could now shift from being a buyer of computing power to a seller.

Some analysts also suggest that this has fueled market anxiety that the demand for AI investment may not be sufficient compared to the massive investments made by hyperscalers to date, thereby impacting stock prices.

Reported by Kim Taewon | Video by Jang Yu-jin | Graphics by Yook Do-hyun | Produced by SBS Digital News
※ Please note: This article was translated by AI and may contain errors.