On Tuesday, the Kospi — South Korea's main equity benchmark — fell by more than 7%, a drop steep enough to activate a circuit breaker, after investor confidence in technology stocks weakened amid mounting concern about intensifying rivalry from Chinese chipmakers, news reports indicated.

Memory-chip stocks retreated broadly after Micron Technology recorded an overnight decline, with news coverage pointing to quickening progress at Chinese chipmaker ChangXin Memory Technologies (CXMT) as one element reshaping how the broader sector's manufacturers are valued by the market.

At 9:47 a.m. local time, a five-minute freeze on programme sell orders was imposed by the Korea Exchange after the KOSPI 200 futures index shed 5.08 percent — equivalent to 51.20 points — bringing it down to 955.02.

At 0213 GMT, the Kospi had shed 382.18 points — a drop of 5.93% — leaving the index at 6,002.06. Four straight down sessions would push the index into territory not seen since September 2024, when its last comparable run of declines played out.

Remarks from Kang Jin-hyuk, an analyst at Shinhan Investment and Securities, put technology-heavy South Korean equities under pressure after he raised the prospect that homegrown chipmakers in China were narrowing the performance gap with long-established global rivals — a view reported by a broadcast news outlet that left market mood visibly more guarded.

Samsung Electronics shed 7.19% of its share value, and SK Hynix lost 8.72%, as South Korea's memory-chip stocks came under broad selling pressure across the session. Losses extended well beyond tech stocks, with battery maker LG Energy Solution among those hit — its shares slipping 4.15% on the day.

Shares in Hyundai Motor retreated 5.78 percent on the day, with Kia Corp posting a separate loss of 3.52 percent. Elsewhere in the session, POSCO Holdings gave back 4.85% of its value, and Samsung BioLogics edged down by 1%.

Of the 915 issues that changed hands, sellers held a commanding position — 832 names posted losses while just 66 managed to finish higher on the day. Overseas portfolio investors offloaded a net 2,065.3 billion won in South Korean equities, deepening the downward pull on the local stock market.

Trading on the onshore settlement platform put the South Korean won at 1,338.8 against the dollar, a slip of 0.22% from its prior closing level of 1,335.8.

Yields on South Korean government bonds drifted downward as unsettled trading conditions took hold across financial markets. Across the three-year Treasury note — the most actively traded on that part of the curve — the rate eased 4.8 basis points, settling at 3.874%, and the ten-year benchmark followed with a steeper retreat of 6.9 basis points to land at 4.250%.

Kospi declines reflected investor concern over an intensifying global contest in semiconductor manufacturing, with developments from China adding pressure to a South Korean equity market that leans heavily on technology-sector listings.