Odaily Planet Daily report: Overnight declines in U.S. chipmaker stocks negatively impacted Asian markets. On Friday, South Korea’s KOSPI index fell as much as 6.1%, with Samsung Electronics and SK Hynix both dropping over 7%, prompting the Korean Exchange to temporarily halt algorithmic trading. In recent weeks, this safety measure has been triggered more frequently within South Korea’s $4.1 trillion market capitalization equity market. The sell-off on Friday coincided with investors seeking to reduce risk ahead of the weekend, as rising tensions in the Middle East have pushed oil prices close to $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 Korea Cash Equities at NH Investment & Securities, said: “Amid 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. (Jin10)