KOSDAQ Index Plunges Over 4%, Triggering 'Sell-Side Car' Trading Halt

The KOSDAQ stock market in South Korea experienced a significant downturn, with the index plummeting nearly 5% during trading hours, triggering a "sell-side car" mechanism. This trading halt, officially known as a program sell order temporary suspension, was activated by the Korea Exchange on the KOSDAQ market at approximately 7:05 PM.

This marks the 14th time this year that a sell-side car has been implemented on the KOSDAQ. The system is designed to temporarily halt program trading when market volatility becomes extreme. Specifically, a sell-side car is activated if the KOSDAQ 150 futures price drops by 6% or the KOSDAQ 150 index falls by 3% and this condition persists for one minute.

At the time the sell-side car was activated, the KOSDAQ 150 futures price stood at 1477.00, a decrease of 6.06% from the previous day. Concurrently, the KOSDAQ 150 index itself had fallen by 5.48% to 1471.82. Earlier in the day, around 10:11 AM, the KOSDAQ index had reached its lowest point, recording 798.04, a drop of 42.85 points or 5.10%. The activation of the sell-side car aims to provide a brief pause, allowing market participants to reassess the situation and prevent further rapid declines driven by automated trading programs.