STOCKS | Korean Shares Fall Below 6,000; Yuanta and Shinhan Analysts Favor Chip Stocks

South Korea’s KOSPI swung sharply over the past week, with volatility reaching a record high. According to Sina Finance, the index closed at 5,730.74 on October 30, down 206.92 points, or 3.48%; it had closed at 6,012.44 on October 28 before falling for a second straight session on October 29. The main board triggered its sidecar mechanism, temporarily suspending program-driven sell orders. Foreign investors were the main source of selling, recording net sales of 1.6168 trillion won on October 30. Analysts attributed the market weakness to U.S. technology companies’ results falling short of expectations and renewed concerns about returns on AI investment. Alphabet, Intel, and Amazon all reported third-quarter results below market expectations; Alphabet’s free cash flow was negative for a second consecutive quarter. Samsung Electronics and SK hynix both reported record results that exceeded expectations. SK hynix said third-quarter operating profit rose 632.1% year over year to 83.3338 trillion won, marking a sixth consecutive quarterly record, while revenue topped 100 trillion won for the first time. The company also announced an additional 60 trillion won in shareholder returns and a substantial dividend increase. Samsung pledged up to 110 trillion won in shareholder returns this year, including 30 trillion won in third-quarter cash dividends, but its shares fell 4.13% on October 29 after its shareholder-return plan disappointed investors. Further details are due at a board meeting in late January. On October 30, concerns about AI infrastructure spending contributed to declines across major U.S. indexes, with the Nasdaq 100 falling 3.46%. Intel dropped 28.58%, wiping out more than $140 billion in market value. Yuanta Securities Korea analyst Lee Jae-won said volatility may persist but advised investors to retain chip holdings, wait for credit risks to stabilize and foreign funds to return, and add positions gradually. He also cited equipment and materials companies and energy storage as areas for potential additional returns. Shinhan Securities senior analyst Kang Jin-hyuk said risks remain, including upcoming cloud-provider earnings and volatile foreign flows, but some uncertainties could ease after the midterm elections.