South Korean financial markets experienced a severe downturn on Tuesday, July 28, 2026, as the benchmark Kospi index plunged more than 10%.
The sharp decline brought the index to its lowest level since April, fueled by heavy losses in major tech companies such as Samsung Electronics and SK Hynix.
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Investors sold off shares amid heightened volatility linked to concerns over the long-term sustainability of the artificial intelligence boom.
Regional and Global Market Impact
Market anxiety spread across regional trading floors, with Japan's Nikkei 225 falling 3% and Taiwan's Taiex dropping 3.8%.
Oil prices also declined by more than 1%, while U. S.
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index futures remained largely unchanged.
The selloff was driven by growing competition from emerging Chinese AI startups and semiconductor manufacturers, which raised fears that rising Chinese capacity could reduce profitability for established global tech firms.
Market uncertainty intensified after Chinese chip manufacturer CXMT surged 466% during its trading debut on Monday, raising at least $8.6 billion in an initial public offering on Shanghai's STAR exchange.
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"The market's concern lies less in CXMT's current earnings and more in its potential for accelerated capacity expansion to rival Korean companies and technology development following its IPO," said Kim Seok-hwan, market analyst at Mirae Asset Securities.
