KOSPI falls over 3% as Samsung, SK Hynix drop; KOSDAQ triggers buy-side circuit breaker

South Korea's main stock index, the KOSPI, plummeted more than 3% in early trading on Monday, dragged down by significant sell-offs in heavyweight semiconductor stocks Samsung Electronics and SK Hynix. The sharp decline marks a continuation of extreme market volatility that has characterized the beginning of the month.

The KOSPI opened 3.60% lower and was trading down 3.38% at 6373.25 points as of 11:15 AM. This follows a tumultuous previous week where the index triggered circuit breakers on two separate days, including a dramatic 17.91% surge on the last trading day of the month.

Monday's downturn was led by semiconductor giants, which had fueled the previous day's rally. Samsung Electronics saw its stock price drop 6.67% to 245,000 won, while SK Hynix fell 6.29% to 1,610,000 won. This sell-off mirrored a pause in U.S. semiconductor stocks, such as Micron and SanDisk, which also experienced pullbacks after significant gains.

Adding to the negative sentiment for memory and storage-related stocks, Kioxia, a Japanese memory chip manufacturer, reported earnings and guidance that fell short of market expectations over the weekend. Meanwhile, the secondary KOSDAQ market showed resilience, trading up 5.10% at 756.40 points, even triggering a buy-side circuit breaker earlier in the morning after opening lower.

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Japan's memory semiconductor company Kioxia's earnings and current quarter guidance both fell below market expectations, which also negatively impacted investor sentiment for memory and storage-related stocks.