KOSPI Falls as Foreign Investors Sell Korean Stocks

South Korea's KOSPI fell sharply on October 12, 2026, closing at 6,384.24 after foreign investors sold Korean equities, while institutions also reduced holdings. The decline reflected continued pressure on a market that had surged on artificial intelligence-related semiconductor demand.

According to asiae.co.kr, the KOSPI dropped 241.69 points, or 3.65%, from the previous session, with trading value reaching KRW 21.3298 trillion. Foreign investors recorded net selling of KRW 2.0205 trillion, while institutions sold KRW 122.8 billion.

The KOSDAQ Composite also weakened, closing at 849.19 after falling 43.08 points, or 4.83%, according to asiae.co.kr. Foreign and institutional investors were net sellers in the secondary market, while individuals bought KRW 247.2 billion.

Finance.yahoo.com reported that South Korea's stock market had shifted from the world's strongest major benchmark in the first half of 2026 to one of the weakest in the second half. The KOSPI has fallen about 24% since its peak while remaining more than 50% higher for the year.

The recent market reversal has been linked to investor concerns over the concentration of AI gains among major memory-chip companies. Samsung Electronics and SK hynix account for more than half of the KOSPI's weight, leaving the index heavily dependent on the semiconductor segment, according to finance.yahoo.com.

Finance.yahoo.com reported that Samsung Electronics shares declined 4.01% on October 12, while SK hynix fell 4.34%. Other major declines included SK Square at 6.0% and Samsung Electro-Mechanics at 3.82%.

Investors have increasingly shifted attention toward a wider AI hardware supply chain, with Taiwan's Taiex gaining about 7% in the second half of 2026 and reaching about 70% year-to-date gains, according to finance.yahoo.com.

The KOSPI has experienced significant volatility in recent months, including a 22% decline in July followed by an 18% rebound on the final trading day of that month. Finance.yahoo.com reported that turnover has since dropped 70% from its late-May peak as foreign outflows continued.