TLDR
- KOSPI fell 2.86% to 6,640.26 as investors reduced exposure to South Korean equities.
- Samsung Electronics and SK Hynix dropped nearly 3%, weighing heavily on the technology-focused benchmark.
- Brent crude approached $96 per barrel, raising fresh concerns about inflation and South Korea’s energy import costs.
- The US 10-year Treasury yield climbed near 4.81%, increasing pressure on technology and other growth stocks.
- Foreign and institutional investors turned net sellers, while retail investors bought shares during the market decline.
South Korean stocks fell sharply on Wednesday as higher oil prices and rising global bond yields pressured major technology and industrial shares. The KOSPI dropped 2.86% to 6,640.26 by late morning after opening more than 3% lower in Seoul on Wednesday.
Samsung Electronics fell 2.97%, while SK Hynix lost 3.13%. Hyundai Mobis, HD Hyundai Heavy Industries and Hanwha Aerospace also declined as investors reduced exposure to risk assets.
KOSPI Slides as Foreign Investors Sell
Foreign and institutional investors returned as net sellers during the morning session. Foreign investors sold about 56.6 billion won, while institutions sold around 10.2 billion won. Retail investors moved in the opposite direction and bought shares during the decline.
Samsung traded more than 3% lower at one stage, while SK Hynix fell as much as 3.6%. Their losses came one day after large share-buyback plans helped support the KOSPI and limit broader weakness.
Kiwoom Securities researcher Han Ji-young said Korean stocks have become more sensitive to oil prices and long-term bond yields. She said investors are watching US-Iran tensions and bond markets in the United States and Japan.
Oil Prices Add Pressure on Korean Markets
Brent crude moved close to $95.91 a barrel after renewed US strikes on Iran increased concerns about supply around the Strait of Hormuz. US crude also climbed above $90 a barrel.
South Korea relies heavily on imported energy. Higher oil prices can raise costs for companies, increase household inflation and weaken the country’s trade balance. Rising crude prices also added pressure to global bond markets.
The US 10-year Treasury yield reached about 4.81%, near a three-year high. Higher yields can weigh on technology shares because investors value future earnings less.
Asian Markets Follow Global Risk-Off Move
Selling also spread across other Asian markets. Japan’s Nikkei 225 fell about 2.2% to 64,742. SoftBank lost 4.1%, Advantest fell 4%, and Tokyo Electron dropped 4.5%.
MSCI’s Asia-Pacific index excluding Japan declined around 1.5%. US equity futures also moved slightly lower after the S&P 500 fell 0.7% and the Nasdaq lost 1% overnight.
Investors in Seoul are now watching whether buybacks and strong semiconductor demand can attract buyers near the 6,600 level. Analysts said buybacks may support trading conditions, but broad selling remains a key risk for the KOSPI.
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