Why did South Korea's KOSPI index fall more than 8%?

South Korea's KOSPI plunged more than 8% after investors reacted to a sharp global selloff in technology and AI-related stocks. Weak sentiment around semiconductor companies, geopolitical concerns and disappointing guidance from Broadcom added to the pressure.

What caused the trading halt in South Korea's stock market?

The KOSPI's rapid decline triggered a market-wide circuit breaker, which automatically pauses trading during extreme volatility. These safeguards are designed to prevent panic selling and give investors time to assess market conditions.

Why were Samsung Electronics and other tech stocks hit so hard?

Technology stocks were at the centre of the selloff because investors reassessed valuations across AI and semiconductor companies. Samsung Electronics reportedly fell about 11%, while other major chipmakers and technology firms across Asia also came under heavy selling pressure.

How did the AI trade contribute to the KOSPI crash?

Many of the stocks driving South Korea's market gains in recent years were linked to artificial intelligence infrastructure and semiconductor demand. As investors became more cautious about AI-related valuations, those same stocks became the primary targets for profit-taking and risk reduction.

What role did Broadcom play in the market selloff?

Broadcom's weaker-than-expected revenue guidance raised concerns about the pace of growth in the AI sector. Investors interpreted the outlook as a potential signal that expectations for AI-related spending may have become too optimistic.

How did other Asian technology stocks perform during the selloff?

The decline spread across Asia, affecting companies such as SK Hynix, TSMC, Hon Hai Precision Industry and SoftBank Group. SoftBank reportedly dropped more than 7% as investors reduced exposure to companies tied closely to AI investment themes.

Why is the South Korean won weakening alongside the stock market?

Investors often move money into safer assets during periods of market stress, which can weaken risk-sensitive currencies. The won's decline to levels not seen since the 2008 financial crisis reflects broader concerns about global growth and investor sentiment.

Image for illustrative purposes only. Not a real photo.

KOSPI tumbles 8% as AI stock rout spreads

Written by Heidi Cuthbert Published Jun 8, 2026, 6:14 AM

South Korea's stock market suffered one of its sharpest declines in recent months on Monday after the benchmark KOSPI fell more than 8% within the first 20 minutes of trading, triggering a circuit breaker and temporarily halting market activity.

The selloff pushed the index into the 7,500 to 7,600 range and coincided with a sharp weakening of the South Korean won, which fell to levels not seen since the 2008 global financial crisis as investors reduced exposure to risk assets.

Technology shares led the decline, with Samsung Electronics reportedly dropping about 11%, while broader pressure spread across Asian semiconductor and AI-related stocks including SK Hynix, Taiwan Semiconductor Manufacturing Company and Hon Hai Precision Industry.

The weakness followed disappointing revenue guidance from Broadcom and growing geopolitical concerns that prompted investors to reassess valuations across the technology sector after a prolonged AI-driven rally.

Meanwhile, SoftBank Group fell more than 7% as selling pressure intensified across companies most closely associated with artificial intelligence infrastructure and semiconductor demand.

Despite the sharp decline, analysts at Goldman Sachs argued the move reflects a technical correction rather than a fundamental deterioration in South Korea's economic outlook, citing continued support from technology investment and long-term growth trends.

Timothy Moe, Goldman Sachs' chief Asia-Pacific regional equity strategist, said the selloff is likely to be remembered as a correction rather than the beginning of a sustained downturn, while investors continue monitoring whether policymakers introduce further measures to stabilise market conditions.