South Korea's KOSPI and KOSDAQ plunge, activating sell‑side sidecars

On June 2, South Korea’s main equity indexes slumped sharply. The KOSPI fell more than 6% in early trade, slipping below the 8,000‑point level for the first time in 15 trading days. At the same time the KOSDAQ dropped over 2%. Both markets triggered automatic sell‑side “sidecar” halts – the KOSPI200 futures fell more than 5% for a minute, and the KOSDAQ150 futures and spot index each fell more than 6% and 3% respectively for a minute, prompting the program‑sell‑order suspensions.

The decline was linked to a sharp sell‑off in U.S. semiconductor stocks after reports that Meta was considering an AI cloud business, sparking worries about over‑capacity and weaker AI‑related demand. Korean semiconductor leaders Samsung Electronics and SK Hynix recorded losses of roughly 7% and 8% respectively. Foreign investors net‑sold about KRW 2.6 trillion, while domestic retail and institutional buyers provided limited buying support. This was the 30th sidecar activation in Korea this year, underscoring heightened market volatility.