South Korea’s KOSPI Falls 10 Percent While Chip Stocks Remain Sharply Higher for the Year

South Korea's stock market fell 10 percent on Tuesday, led by sharp declines in SK Hynix and Samsung. The drop formed part of a broader sell-off in chip-related shares that extended to U.S. markets. Micron, AMD, and Intel each declined 6 percent in the United States.

The Nasdaq 100 index shed more than $1 trillion in market value by the open before recovering some ground. The iShares Semiconductor ETF remained up 95 percent year-to-date after the session. The KOSPI itself had risen nearly 100 percent earlier in the year.

Jim Paulsen, former chief strategist at The Leuthold Group, said more downside could follow if tech stocks break through their previous low, which would mark another 3 percent drop. Craig Johnson, chief market technician at Piper Sandler, stated that confirmation of a new high is needed soon or dip buyers will fade.

Andrew Slimmon, senior portfolio manager at Morgan Stanley Investment Management, called the sell-off healthy and an opportunity to add to tech holdings.

Bret Kenwell, U.S. investment analyst at eToro, said weakness could last several weeks after the sector entered a perfect storm. Joe Mazzola, head of trading and derivatives strategy at Charles Schwab, wrote that the move appears to be a stress test of crowded leadership rather than a broad macro panic.

Dan Ives of Wedbush Securities said firm checks showed no cracks in the armor. David Rosenberg of Rosenberg Research noted that U.S. households hold a record 73 percent share of equities in their financial asset mix and questioned whether retail investors will buy the dip again.