Yi Whan-woo is a Korea Times journalist primarily covering finance. He writes in-depth articles on macroeconomy and financial markets and previously covered sports, politics, diplomacy and inter-Korean affairs, among others. Feel free to contact him at yistory@koreatimes.co.kr.
KOSPI falls below 4,000 amid foreign sell-offs
An electronic trading board at Hana Bank headquarters in central Seoul shows the benchmark KOSPI closing at 3,953.76 points, Friday, down 1.81 percent from the previous session. Yonhap
By Yi Whan-woo
The benchmark KOSPI closed below 4,000 points for the first time in two weeks on Friday, as foreign and institutional investors sold off following an overnight U.S. market decline over artificial intelligence (AI) bubble fears and major job cuts.
The sell-offs also pushed the Korean currency to below 1,450 won per dollar in daytime trading on Friday, adding to concerns that the 1,400-won level could be becoming the new normal.
The KOSPI closed at 3,953.76 points, down 1.81 percent from Thursday's close.
This marked the first time the main index finished below the 4,000-point level since reaching an unprecedented closing high above that threshold on Oct. 27.
The index had subsequently passed 4,100 points on Oct. 31 and 4,200 points on Monday.
The index opened the day at 3,963.72 points, down 1.56 percent from the previous session. It narrowed its losses and briefly recovered above the 4,000-point level but fluctuated throughout the day before finishing below it.
Friday’s decline followed an overnight tumble in the U.S. market, where the S&P 500 fell 1.1 percent and the tech-heavy Nasdaq dropped 1.9 percent.
The U.S. market fall was fueled by concerns that the recent boom in AI company valuations could be rapidly cooling, as well as a report from global outplacement firm Challenger, Gray & Christmas, which recorded 153,074 job cuts last month — the worst October since 2003.
Amid these developments, foreign investors posted net sales exceeding 470 billion won ($322.6 million), while institutional investors sold more than 220 billion won.
Retail investors, however, recorded net buying of over 690 billion won, helping to partially offset the decline later in the session.
Among the top market-cap stocks, Samsung Electronics fell 1.31 percent to 97,900 won and SK hynix declined 2.19 percent to 580,000 won.
Other major stocks also posted losses. LG Energy Solution was down 1.38 percent, Hyundai Motor fell 1.86 percent, Doosan Enerbility dropped 1.77 percent and Hanwha Aerospace slid 4.85 percent.
The Korean currency closed at 1,456.9 won per dollar in daytime trading on Friday, weakening by 9.2 won from Thursday’s close and hitting its lowest level in about seven months.
It opened at 1,448.1 won, down 0.4 won from the previous close, fell below 1,450 won before noon and remained near that level for the rest of the session.
Analysts said risk-aversion sentiment following the U.S. market decline prompted foreign investors to pull funds from emerging markets such as Korea, boosting demand to exchange won for dollars.