Korea Stocks Crash on 'Black Tuesday' as Chip Rout Halts Trading

South Korean equities suffered one of their steepest single-day falls on record on July 28, with the benchmark KOSPI tumbling 10.8% and the tech-heavy KOSDAQ dropping 7.7% as a sharp decline in US semiconductor shares spread through Seoul trading and forced regulators to halt both markets. The rout, quickly dubbed another “Black Tuesday,” wiped out weeks of gains within hours and pushed the KOSPI intraday below the 6,200 line.

A cascade of trading halts

The selling was severe enough to trip Korea’s tiered market-stabilization mechanisms in sequence. Sidecars — which temporarily suspend program trading when futures move sharply — were activated on both the KOSPI and KOSDAQ as losses widened through the morning. When the main board’s decline pushed past 8%, exchange operators escalated to a full circuit breaker, pausing cash trading outright. By the close, both markets had seen circuit breakers imposed, an unusual dual halt that underscored how broad and fast the drop was.

Chipmakers at the center of the fall

The damage was concentrated in Korea’s largest exporters. Samsung Electronics and SK Hynix, which together anchor a substantial share of the KOSPI’s market value, each fell roughly 11% to 12% at their intraday lows. Because the two chipmakers carry such heavy index weightings, their slide alone accounted for a large portion of the benchmark’s overall decline and helped drag the wider market into halt territory.

What set it off

The trigger came from overseas. A steep drop in US semiconductor stocks, compounded by fresh strains in the US–China relationship, sent a chill through Asian tech names ahead of and during Seoul’s session. As a supply-chain hub for memory chips and a market unusually exposed to global semiconductor sentiment, Korea absorbed an outsized share of that shock, with the KOSDAQ’s smaller, higher-beta names falling alongside the blue chips.

Why the scale matters

Double-digit index moves are rare, and a same-day circuit breaker on both the KOSPI and KOSDAQ is rarer still. The dual halt signals not just a bad day but a liquidity event in which sellers overwhelmed available buyers across market caps. For investors, the immediate questions now turn to how much of the drop reflects forced, mechanical selling versus a durable repricing of Korea’s chip-dependent export economy — and whether overnight moves in US technology shares will deepen or stabilize the picture when Seoul reopens.