[Weekly Market Review] KOSPI Tumbled 7,216-6,400 in Four Days; Sidecars Halted Trading Two Consecutive Sessions

The KOSPI plunged from 7,216 to 6,400 before recovering to 6,912 over four trading sessions from Aug. 18–21.

1. The KOSPI ended the week down 0.93%, while KOSDAQ fell 7.25%.

2. On Aug. 19, the market crashed 5.80%; the next day, it rallied 5.89%. A sidecar—which temporarily halts program-trading orders after a sharp futures-market move—was triggered on the sell side, then again on the buy side across consecutive sessions.

3. SK Hynix announced it would repurchase and retire 40 trillion won in shares.

Aug. 17 was Chuseok holiday, so trading occurred only four days that week. Yet the intraday swing from peak to trough was 12.75%. The high was 7,216.62 on the morning of Aug. 18; the low was 6,400.81 on the morning of Aug. 19.

Tuesday morning was solidly above 7,200

KOSPI opened Aug. 18 up 2.15% and climbed to 7,216.62 in early trading—an all-time high intraday level. Yet the close that day was 6,869.83, down 1.55%. Morning buyers and evening observers saw entirely different markets.

Interest rates were the culprit. US 30-year Treasury yields hit 5.310%, their highest since 2007, and Japan's 10-year rate reached a 30-year peak. Tensions between the US and Iran around the Strait of Hormuz pushed crude higher, stoking inflation concerns and, in turn, rate expectations.

Two of the four sessions saw swings exceeding 5%.

Aug. 19: KOSPI fell 5.80%

Wednesday opened down 4.96%. Early in the session, the index fell to 6,400.81, a decline of 6.83%. This triggered the 48th sidecar of the year, the 25th on the sell side.

One more headwind piled on: the Pennsylvania governor signed an executive order requiring environmental and community approval before data-center construction. Delays in data-center buildout ripple through the entire AI semiconductor supply chain across Korea, Japan, and Taiwan, triggering selling across the region.

Samsung Electronics fell 7.82%, SK Hynix 9.75%. SK Square dropped 11.54%, Samsung Life slid 11.11%. Foreign investors net-sold 3.5035 trillion won, while institutions net-sold 1.3231 trillion won. Retail investors absorbed 4.6357 trillion won of the selling.

Gray bars show the intraday high-low range. Aug. 18's bar is notably tall.

After the market closed on Aug. 19, a 40 trillion won disclosure arrived

After trading ended on Aug. 19, SK Hynix filed a material-event report with the Financial Supervisory Service. The numbers: 24,070,000 shares targeted for repurchase, total outlay 40 trillion 43.4 billion won. The purchase period runs from Aug. 20 through Nov. 19. The stated purpose: "enhancement of shareholder value through share retirement."

The company plans to buy and retire these shares, not hold them in treasury. A separate disclosure confirmed the retirement decision the same day—the largest share-buyback program announced by a Korean-listed company.

The next day, SK Hynix rose 12.73% and Samsung Electronics gained 9.49%. KOSPI rallied 5.89%. The market triggered its 24th buy-side sidecar of the year. Two consecutive sessions, opposite directions on the sidecar mechanism.

The hole dug on Aug. 19 was filled in a single day on Aug. 20. Over the week, both stocks ended in positive territory.

Was Samsung Electronics' 100 trillion won commitment real?

Throughout the week, observers speculated that Samsung Electronics would announce a 100 trillion won shareholder payout plan. That prediction materialized after the close on Aug. 21 via official disclosure. Samsung disclosed that its remaining 2026 shareholder-return capacity is approximately 90-110 trillion won. This represents the balance after subtracting the 29.3 trillion won already deployed from the three-year policy of returning 50% of free cash flow over 2024-2026.

A timetable followed: around 30 trillion won in cash dividends—including the regular quarterly distribution—during Q3 2026, with specifics to be confirmed by the board in late October. The remainder will be decided by the board in late January 2027. What was confirmed this week was the magnitude of the program, not its execution.

One source of potential confusion: Samsung also disclosed on Aug. 21 a separate 15 trillion won share-repurchase decision. This is not part of the shareholder-return program. The stated purpose is "employee stock compensation," meaning these shares will be distributed as performance incentives, not retired. Samsung explicitly stated in the same disclosure that this expense is excluded—not included—in calculating available shareholder-return funds. The nature of SK Hynix's 40 trillion won is fundamentally different.

KOSPI held steady, but why did KOSDAQ drop 7%?

The KOSPI finished the week down just 0.93%, essentially flat. KOSDAQ fell 7.25%. Over the same four days, the gap widened by more than 6 percentage points.

The reason is straightforward: the week's rallying catalyst came from exactly two stocks. The share-buyback disclosures were filed by Samsung Electronics and SK Hynix; KOSDAQ had no equivalent catalyst. KOSDAQ closed Aug. 21 down 4.63%, triggering another sell-side sidecar that day. Semtec fell 13.23%, ABL Biotech slid 8.85%, Ecopro BM dropped 7.45%. The pharma-and-biotech strength from the prior day evaporated in a single session.

Concentration deepened within semiconductors too. By theme on Aug. 21, only large-cap semis—Samsung Electronics and SK Hynix—advanced; HBM, chip equipment, semiconductor substrates, and system semiconductors all declined. It was not the semiconductor sector that lifted the index; it was two companies.

The two lines cross on Aug. 20. From that point, only KOSPI climbed.

After retail investors bought 4.6 trillion won on the dip, what happened next?

For the four-day week, foreign investors net-sold 1.9 trillion won, institutions net-sold 2.4 trillion won, and retail investors net-bought 1.9 trillion won. The sequence, though, is more revealing than the total.

On Aug. 19, the crash day, retail investors absorbed 4.6357 trillion won. When the index rose 5.89% the next day, retail sold 2.2712 trillion won. Foreign investors were the buyers that day, picking up 1.7229 trillion won. On Aug. 21, retail sold another 1.1651 trillion won. The pattern: retail bought the dip, then sold into the bounce.

The red bar on Aug. 19 is the week's largest.

Over four sessions, limit-up and surge stocks were tallied by catalyst: semiconductors led with 20 instances, pharma-and-biotech accounted for 16, crypto and payment systems for 14, and robotics and AI for 13. Bitcoin's break above $70,000 drove the week's emerging strength in cryptocurrency-related themes.

Stocks hitting multiple catalysts are counted in each category.

By the numbers

Index/Company	Aug. 14 Close	Aug. 21 Close	Weekly Change
KOSPI	6,977.94	6,912.95	-0.93%
KOSDAQ	864.65	801.94	-7.25%
Samsung Electronics	-	-	+2.54%
SK Hynix	-	-	+5.16%
Dollar-Won Exchange Rate	-	1,386.5	25.3 won stronger vs. Aug. 18
Korea 10-Year Yield	-	4.376%	+5.3bp on Aug. 21

The won actually strengthened over the week. The won hit 1,397.7 on Aug. 19, dipping below 1,400 for the first time in about 11 months and eventually reaching 1,386.5 on Aug. 21. That the won gained ground on a day the index crashed 5.8% suggests foreign capital stayed onshore rather than fleeing. However, drawing firm conclusions from a single day's exchange rate is premature; next week's flow will reveal more.

What to watch next week

Item to Track	Why It Matters
SK Hynix share buyback execution	Open-market purchases begin Aug. 20 with a daily limit of 2,407,000 shares. Actual acquisition volumes will be disclosed in regulatory filings
US long-term Treasury yields	This week's crash was ignited by yields. Whether the 30-year stays in the 5.3% zone is crucial
Strait of Hormuz tensions	US-Iran negotiations have passed their deadline without accord. The oil-to-rate transmission channel remains active
Data-center approval rules spreading	Whether Pennsylvania's environmental and community approval mandate remains isolated or spreads to other states will shape memory-chip demand forecasts
KOSDAQ recovery	The 800 level looms. Will large-cap concentration ease, or will the gap widen further?

In one sentence, this week saw the market panic and sell, then large-cap companies buy their own stock to absorb the pain. Interest rates and crude remain elevated, yet the index recovered. The unease lingers. The 40 trillion and 90 trillion won buyback programs will take months to deploy, and rates will continue to move in that window.

Should you buy now? I don't know. But one number from this week is indisputable: the gap between the index's performance and your portfolio's reality is vast. KOSPI was down 0.93%; KOSDAQ was down 7.25%.

Investment decisions and their consequences are yours alone.