KOSPI Hits Bear Market Territory Following Holiday Selloff

The KOSPI index reopened with a sharp decline on July 20 after being closed for Constitution Day. The index fell more than 25 percent from its June peak, officially placing it in a technical bear market. This move was driven by a mix of concerns over semiconductor performance and rising geopolitical tension in the Middle East.

Chip giants Samsung Electronics and SK Hynix faced heavy selling pressure at the opening bell, dropping more than 5 percent. The industry is currently dealing with increased competition from Chinese artificial intelligence models, which has dampened investor sentiment. While foreign investors purchased nearly 200 million dollars in electronics stocks, local retail investors leaned toward selling their positions.

Broader economic pressure is also rising as the local currency continues to slide against the dollar. The energy market is reacting to fears that conflict might disrupt shipping lanes, which is pushing oil prices higher and complicating the inflation outlook. Analysts are now looking toward upcoming earnings reports from major US tech firms to see if chip stocks can stabilize.

Keep an eye on results from Alphabet, Microsoft, Meta, and Amazon later this month. Capital spending plans from these companies will likely set the tone for the semiconductor industry and global market confidence in the near term.