HighIV Macro Policy & Sovereign Debt15 October 2026, Thursday · 09:30 TRT (UTC+3)

Kospi plunges 7.57% on AI spending fears, triggering a trading halt

The Kospi lost 454.59 points on 15 October to close at 5,554.22, its lowest close since 7 April. When the intraday loss reached 9.29%, the Korea Exchange halted trading for 20 minutes.

Korea Exchange (KRX) building, Busan (March 2012) — representative archive photoPhoto: hyolee2 / Wikimedia Commons · CC BY-SA 3.0 · resized · Source

Location: SEOUL

According to The Herald Business, the index has shed 1,449.52 points, or 21%, over 7 sessions since 6 October. Foreign investors were net sellers of 3.63 trillion won (about $2.7bn) on 15 October, extending their selling streak to 8 sessions. Institutions absorbed 1.69 trillion won and retail investors 1.29 trillion won in net purchases. Samsung Electronics fell 9.48% to 210,000 won and SK hynix 11.06% to 1.262 million won. The two companies make up about half of the Kospi's market value; over 7 sessions Samsung has lost 24% and SK hynix 31%.

Two triggers drove the sell-off. US consumer inflation for September came in at 3.7% against expectations of 3.6%, stoking fears of another Fed hike; The Korea Times said the 10-year US Treasury yield rose above 5.3%. A Gartner projection cited by The Herald Business shows about $1tn going into AI infrastructure in 2026 and a further $6tn in 2027–2030. Against that, data-centre revenue may reach only $3.6tn of the $8.5tn needed by 2030. The Philadelphia Semiconductor Index had fallen 4.30% the night before.

The selling spread across the region. The Nikkei 225 fell 4.90% and the Taiex 3.41%; the won weakened to 1,344.6 per dollar at 15:30. The Financial Services Commission held an emergency meeting and called the pace of the decline an overreaction. Sources diverge on this year's circuit-breaker count. The Korea Times described it as the ninth of the year, while The Herald Business wrote that it was the first halt for both indices since 29 July.

Talay assessment

Bottom line

The Kospi's 21% loss over 7 sessions tests Korea's concentration in two memory makers against both the US rate path and doubts over AI returns at the same time. Foreigners are doing the selling and domestic investors the buying; an 8-session foreign exodus is straining that balance. The most likely path is high volatility until quarterly earnings arrive, with the won staying under pressure around 1,345.

Likely effects

Korean wonNegativeWeeks
Eight sessions of foreign equity outflows pushed the won to 1,344.6 per dollar; if outflows persist, currency pressure will feed into the imported energy bill.
Retail investorsNegativeWeeks
Retail net purchases of 1.29 trillion won raise the risk of forced liquidation on margin positions if the slide continues; the FSC issued a leverage warning.
Regional chip chainNegativeWeeks
Falls of 4.90% in the Nikkei and 3.41% in the Taiex show the selling is not Korea-specific but spans the entire AI hardware chain.
TürkiyeUncertain1–6 months
Shrinking Korean and Taiwanese weights in emerging-market funds could mechanically shift the allocation index funds give other countries; the direction of the effect could not be verified.

Possibilities, ranked

1
Volatile search for a floor50%
Foreign selling slows but does not stop; the Kospi swings in a wide band until earnings season.
Watch: Samsung and SK hynix third-quarter results in late October, and foreign net flows
2
Rate-driven deepening30%
Expectations of a Fed hike firm, the US 10-year yield stays above 5.3% and selling continues with further circuit breakers.
Watch: The US 10-year yield and Fed comments ahead of the November meeting
3
Rapid recovery20%
Firm memory prices and strong earnings bring foreigners back; the sell-off proves a technical excess.
Watch: Foreigners turning net buyers of the Kospi for 3 sessions in a row

Probabilities are calibrated judgement based on the sources, not measurement, and are revised as new information arrives. Not investment advice.

Market reaction

Indicators affected

Kospi▼ −7.57%
Foreign net selling▼ 3.63tn won
Won/dollar▼ 1,344.6