Seoul Shares Plunge Nearly 6 Percent Amid Tech Sell Off and Rising Yields

The benchmark Korea Composite Stock Price Index (KOSPI) fell 398.66 points, or 5.8 percent, to close at 6,471.17 on Wednesday. The market touched an intra day low of 6,400.81 as chipmakers led a steep decline. Samsung Electronics plunged 7.82 percent to 247,500 won, while SK hynix tumbled 9.75 percent to 1.5 million won. Other affected firms included SK Square, which sank 11.54 percent, and Samsung Electro Mechanics, which decreased 3.68 percent.

Investor sentiment was dampened by rising oil prices and global bond yields. The U.S. 30 year Treasury yield rose to its highest level since 2007 due to concerns that energy prices could sustain high inflation. Additionally, Wall Street indexes closed lower following stalled peace efforts between the United States and Iran. In response to the volatility, the bourse operator activated a sell side sidecar, suspending program trading for five minutes after the KOSPI 200 futures index fell 5 percent or more for at least one minute.

Trade volume reached 302.07 million shares worth 22.94 trillion won. Foreigners and institutions were net sellers of 348.8 billion won and 132.4 billion won, respectively, while individual investors bought a net 463.6 billion won. In contrast to the general decline, Hanwha Aerospace rose 2.71 percent to 1,177,000 won after its U.S. unit won a contract to deliver K9 self propelled howitzer prototypes to the U.S. Army. The Korean won rose 14.1 won from the previous session to close at 1,397.7 won per U.S. dollar.