BlockBeats news, on July 24, overnight declines in U.S. semiconductor manufacturers' stock prices simultaneously impacted Asian markets. The South Korean KOSPI index fell as much as 6.1% on Friday, with Samsung Electronics and SK Hynix both dropping over 7%, prompting the Korean Exchange to temporarily halt algorithmic trading.
In recent weeks, this safety mechanism has been triggered more frequently within South Korea’s $4.1 trillion stock market. Friday’s selling surge coincided with investors seeking to reduce risk ahead of the weekend, as rising tensions in the Middle East have pushed oil prices to around $100 per barrel. After four consecutive days of net buying, global investors resumed selling in the Korean stock market, primarily reducing holdings in technology stocks.
Shawn Oh, Head of Cash Equities at NH Investment & Securities Korea, said: "Due to ongoing tensions in the Middle East, local funds reduced their exposure to technology stocks and lowered risk ahead of the weekend, amplifying downside risks."
Roy Lim, a stock sales trader at Samsung Securities, said some Asian hedge funds are selling shares of Samsung and SK Hynix to increase their positions in China’s CXMT, which is set to list on July 27.