{"id":614736,"date":"2026-06-08T00:36:22","date_gmt":"2026-06-08T00:36:22","guid":{"rendered":"https:\/\/buglecall.org\/?p=614736"},"modified":"2026-06-08T00:36:22","modified_gmt":"2026-06-08T00:36:22","slug":"korea-black-monday-kospi-halted-for-20-minutes-after-crashing-almost-10-2","status":"publish","type":"post","link":"https:\/\/buglecall.org\/?p=614736","title":{"rendered":"Korea “Black Monday”: Kospi Halted For 20 Minutes After Crashing Almost 10%"},"content":{"rendered":"

Korea “Black Monday”: Kospi Halted For 20 Minutes After Crashing Almost 10%<\/span><\/p>\n

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After the close on Friday, we said that on Monday, Korean stocks would be a “bundle of joy”…<\/strong><\/p>\n

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Korea on Monday will be a bundle of joy<\/p>\n

\u2014 zerohedge (@zerohedge) June 5, 2026<\/a><\/p><\/blockquote>\n

… and that appears to be playing out in early Asian trading, as the Kospi index crashed 8.8% just after the open,\u00a0taking the key index’s decline from its recent peak to nearly 17%, poised to enter a technical correction and on pace for an outright bear market (20% drop from highs) should the local plunge protection team fail to stem the collapse.<\/p>\n

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Memory maker Samsung Electronics fell as much as 11% while peer SK Hynix Inc. slid 10%.<\/p>\n

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Since these two stocks account for virtually all the recent upside in Korean stocks, levered retail investors – who were buying everything foreign investors had to sell after a record stretch of 21 days of non-stop selling…\u00a0<\/strong><\/p>\n

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Foreigners have sold Korean stocks every single day – mostly to domestic ultra-levered retail investors – since May 6, the longest stretch on record by far. pic.twitter.com\/78EQExLJr6<\/a><\/p>\n

\u2014 zerohedge (@zerohedge) June 5, 2026<\/a><\/p><\/blockquote>\n

… are having a very bad day.\u00a0<\/strong><\/p>\n

The sudden plunge triggered a circuit breaker, halting trading for 20 minutes.\u00a0 The Korea Exchange held an emergency\u00a0meeting\u00a0Monday to assess rising volatility and discuss measures to ensure stable market operations.<\/p>\n

Concerns over overheating in the AI rally combined with uncertainty in the macro environment have taken some steam out of global tech stocks over the past few sessions. Korea is seeing outsized losses after its world-beating gains, with the Kospi still up 77% since the start of the year.<\/p>\n

As we pointed out\u00a0most recently last Thursday<\/a>\u00a0just as the Kospi hit its all time high, foreign investors have been fleeing<\/strong>, selling more than\u00a0$10 billion\u00a0worth of Kospi shares on a net basis last week alone.<\/p>\n

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That\u2019s put pressure on the won<\/strong>, with the currency touching its weakest level against the dollar since March 2009. \u00a0\u00a0<\/p>\n

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We warned Friday<\/a> that\u00a0market breadth is the central worry.<\/strong> Samsung Electronics and SK Hynix, enjoying AI-driven chip demand, account for 54% of the Kospi\u2019s market weight and roughly half of the gauge\u2019s average daily turnover in May, according to Korea Exchange data. Nearly three-quarters of its gains this year have come from the two firms.<\/p>\n

When the benchmark hit a record on Tuesday, only 2.6% of stocks reached 52\u2011week highs while 31% slid to 52\u2011week lows<\/strong><\/p>\n

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Single\u2011stock leveraged ETFs tied to Samsung and SK Hynix are adding to concerns. <\/strong><\/p>\n

The four most popular single-stock ETFs accounted for 21% of the total ETF turnover in South Korea in their first five sessions after launching May 27, exchange data show.<\/p>\n

\u201cThe current market structure is vulnerable to a downturn as it\u2019s dominated by the short gamma in the leveraged ETFs,\u201d<\/strong> said Kenny Kim, chief executive officer at Meridian One Asset Management. <\/em><\/p>\n

\u201cThe setup requires investors to chase rallies with heavy buying when the market rises, but forces them to dump shares when the market falls.\u201d<\/em><\/p>\n

Retail investors, once key drivers, are showing less willingness to commit fresh cash. Brokerage deposits fell to 121 trillion won ($79 billion) by May 22 from 137 trillion won on May 12, according to the Korea Financial Investment Association.<\/p>\n

Meanwhile, margin balance hit a record 38 trillion won on May 29, up from 27.3 trillion won at end-2025, KFIA data show.<\/strong><\/p>\n

Rising margin loans alone may indicate heightened interest. But the increase, while investor deposits fall, may point to more leverage stress without fresh appetite to take on risk, according to Shawn Oh, an equity sales trader at NH Investment & Securities.<\/p>\n

\u201cThe signal is clear: the cash buffer eroding while active leverage refuses to unwind,\u201d<\/strong><\/em> he added.<\/p>\n

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The South Korean market faces risk of a \u201cBlack Monday\u201d event with \u201ccurrency instability, interest-rate repricing and profit taking in semiconductors all happening at the same time,\u201d <\/strong>said Kim Doo-un, an analyst at Hana Securities.<\/p>\n

The government on Sunday laid out a series of targeted measures to try and bolster the won, pledging firm action against speculative trading and other activities. The moves come as policymakers across Asia step up efforts to support their currencies amid rising energy costs and a stronger dollar stemming from the Iran war.<\/p>\n

Finally, there is a silver lining for some as Korea’s loss is crypto’s gain…<\/p>\n

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Kospi bubble bursting is just what bitcoin bros are waiting for https:\/\/t.co\/aAazCwjzpG<\/a><\/p>\n

\u2014 zerohedge (@zerohedge) June 5, 2026<\/a><\/p><\/blockquote>\n

…for now.<\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nSun, 06\/07\/2026 – 20:36<\/span><\/p>","protected":false},"excerpt":{"rendered":"

Korea “Black Monday”: Kospi Halted For 20 Minutes After Crashing Almost 10% After the close on Friday, we said that on Monday, Korean stocks would be a “bundle of joy”… Korea on Monday will be a bundle of joy \u2014 zerohedge (@zerohedge) June 5, 2026 … and that appears to be playing out in early… Continue reading Korea “Black Monday”: Kospi Halted For 20 Minutes After Crashing Almost 10%<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":614731,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":[],"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[20,23],"tags":[],"class_list":["post-614736","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economic-empowerment","category-national-security","entry"],"_links":{"self":[{"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/posts\/614736","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buglecall.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=614736"}],"version-history":[{"count":0,"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/posts\/614736\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buglecall.org\/index.php?rest_route=\/wp\/v2\/media\/614731"}],"wp:attachment":[{"href":"https:\/\/buglecall.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=614736"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buglecall.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=614736"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buglecall.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=614736"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}