The KOSPI index recorded strong volatility this Thursday (2) after falling more than 6% in the first hours of trading in South Korea. The intensity of the sell-off led the Korea Exchange (KRX) to trigger the mechanism known as sidecar, temporarily interrupting part of trading to contain extreme market movements.
The opening already indicated a day of strong pressure, with the index falling 4,46%. Losses intensified rapidly and, at 9h51 local time, the KOSPI was down 534,25 points, equivalent to a drop of 6,43%, trading at 7.769,16 points.
At the time of publication of this news, however, the market was showing a partial recovery. The index was trading near 8.046,55 points, reducing part of the losses from the start of the session and recording a drop of about 3%, although it remained in negative territory.
The sidecar is a protection mechanism used by the KRX to reduce excessive fluctuations. The tool is triggered automatically when KOSPI 200 futures contracts fall at least 5% for one consecutive minute, suspending programmed trading of the stocks that make up the index for five minutes.
The new interruption reinforces a year marked by strong instability on the South Korean stock exchange. Throughout 2026, the KRX has already had to resort several times to protection mechanisms, even surpassing the levels recorded during the 2008 global financial crisis.
By the end of June, the exchange had recorded nearly 30 sidecar activations and five circuit breakers, figures that had already surpassed the entire volume recorded in 2008, when the market set its annual record for interruptions caused by volatility.
Much of this pressure is linked to the performance of semiconductor manufacturers. Samsung Electronics and SK Hynix, which together represent approximately half of the KOSPI's market capitalization, once again led the losses during the session.
The shares of both companies followed the global wave of selling in the chip sector that began on Wall Street. In the previous session, the Nasdaq Composite closed the trading day down 0,66%, while the VanEck Semiconductor ETF fell 5,4%. In addition, the shares of Micron Technology and Sandisk each lost more than 10%, increasing the pressure on Asian manufacturers.
The move represents a significant correction after weeks of gains for semiconductor companies, which had driven the KOSPI to renew record highs at the beginning of this year. Although the index reduced part of its losses during the trading session, the performance of the giants in the chip sector remains the main factor monitored by investors and should continue to influence the behavior of the South Korean stock market throughout the session.