South Korean stocks face 'Black Monday' fears as futures hit limit down

South Korean stocks are bracing for a potential "Black Monday" as global markets experience a significant downturn. The KOSPI 200 futures contract plummeted to its daily limit, falling 8% in overnight trading, mirroring a broader market sell-off.

This sharp decline follows a major drop in U.S. markets last Friday, with the Philadelphia Semiconductor Index losing over 10%. In Germany, SK Hynix's GDRs (Global Depositary Receipts) plunged 20.5%, and Samsung Electronics GDRs fell 15.02%. This has fueled worries that the South Korean stock market will face similar pressure when it opens.

Analysts attribute the global market jitters to rising interest rates and investor doubts about the peak of AI company growth. In South Korea, concerns are amplified by a rise in credit-financed stock purchases to 37 trillion won (approximately $26 billion USD). The increased scale of single leveraged ETFs for Samsung Electronics and SK Hynix could further exacerbate short-term volatility.

Despite the potential for a steep market drop, some experts believe the underlying performance of semiconductor companies remains strong. They argue that this current shock does not signal the beginning of a prolonged downturn, suggesting that the fundamentals of key industries are not fundamentally impaired.