KOSPI halts trading as chip stocks trigger market-wide selloff

The market turmoil intensified mid-session, with Reuters reporting that the index had extended its losses to roughly 9.4% by early afternoon. This volatility followed a series of "sidecar" curbs designed to restrict program trading as futures and cash shares plummeted in tandem. The selloff was largely driven by a broader retreat in semiconductor stocks, fueled by investor anxiety over the sustainability of AI infrastructure spending and potential competitive threats from China’s domestic memory producers.

SK Hynix remained at the center of the volatility, with its U.S.-listed American depositary receipts closing at $143.02—the first time the stock has finished below its $149 offering price. The company is set to release its second-quarter earnings on July 29, a report that will likely dictate the short-term trajectory for both the stock and the broader index. Adding to the pressure, the Financial Services Commission is preparing to tighten regulations on leveraged exchange-traded products starting July 31, raising the minimum cash requirement for retail investors to 30 million won.