KOSPI falls toward 6,500 as chip sentiment remains weak

KOSPI and the share prices of SK hynix and Samsung Electronics are displayed in the dealing room of Hana Bank in Seoul, Monday. The benchmark index closed at 6,516.27, down 4.46 percent from the previous session. SK hynix and Samsung Electronics fell 4.23 percent and 4.31 percent, respectively, to close at 1,764,000 won ($1,192) and 244,000 won. Newsis

The KOSPI extended its losing streak, Monday, falling toward 6,500 as sentiment surrounding the semiconductor sector weakened further amid growing risks related to a military conflict between the U.S. and Iran.

The benchmark closed at 6,516.27, down 4.46 percent from the previous session. It opened 2.6 percent lower and extended its decline. A sell-side sidecar was triggered at 11:21 a.m., marking the 20th such activation on Korea's main bourse this year.

Institutional investors sold a net 919 billion won ($621 million) of shares. Foreign and retail investors bought a net 515.3 billion won and 349.1 billion won, respectively.

The Korean stock market reflected external headwinds that had accumulated during Friday's holiday closure and over the weekend, according to Lee Kyoung-min, an analyst at Daishin Securities.

An artificial intelligence (AI) model from China's Moonshot, called Kimi K3, was assessed as delivering performance close to that of the most advanced models from OpenAI and Anthropic. The news raised questions about whether the massive capital expenditures undertaken by hyperscalers can be justified and fueled concerns over slowing demand for AI investment and semiconductors.

Tensions between the U.S. and Iran also escalated after U.S. military casualties were reported in the conflict. WTI crude futures rose above $83 a barrel, while Brent futures climbed past $90, further dampening risk appetite on concerns that higher oil prices could reignite inflationary pressures.

SK hynix sank 4.23 percent to 1,764,000 won, while Samsung Electronics dropped 4.31 percent to 244,000 won.

"The earnings season for AI companies, which begins this week, is expected to serve as a key inflection point for assessing both the sustainability of AI demand and whether semiconductor stocks can emerge from their current deleveraging and de-rating phase," said Han Ji-young, an analyst at Kiwoom Securities.

Alphabet is scheduled to report its earnings Thursday, and Intel the day after.

The secondary Kosdaq fell 5.33 percent to 749.64. A sell-side sidecar was triggered at 10:52 a.m., marking the 10th such activation on the Kosdaq this year.

The won strengthened slightly, with the won-dollar exchange rate closing at 1,478.4 won, down 0.1 won from the previous session.