KOSPI Plunges 5.4% Approaching Technical Bear Market! Korean Regulator: Overconcentration in Semiconductor Stocks Amplifies Volatility

South Korea's KOSPI index closed down 409.53 points, or 5.35%, at 7,246.78 on Wednesday (8th), briefly triggering a 'temporary trading halt' mechanism. The index has now fallen approximately 20% from its June peak, approaching a technical bear market. Regulatory authorities convened an emergency meeting, warning that overconcentration in semiconductor stocks has become a core risk amplifying market volatility.

During Wednesday's session, KOSPI plunged as much as 5.7%, hitting its lowest level since May 20, before partially recovering on a rebound in chip stocks. However, it remains about 15.6% below its all-time high set on June 22. SK Hynix saw intraday losses of up to 5%, while Samsung Electronics一度 fell as much as 6.9%.

South Korean Finance Minister Koo Yun-cheol convened a meeting on Wednesday with the Governor of the Bank of Korea (BOK) and heads of financial regulatory agencies. A post-meeting statement cited profit-taking and portfolio rebalancing by foreign and institutional investors, along with shifting global expectations for AI-related equities, as factors driving increased market volatility.

The statement directly highlighted the concentration risk in semiconductor stocks, stating, 'The rising concentration in semiconductor stocks has become a driver of market volatility, and fluctuations in the chip sector are increasingly impacting the broader stock market.'