Chip stocks sold off amid Middle East tensions, South Korean stocks plunge again

Odaily reported that the overnight decline in US chip manufacturer stocks impacted Asian markets. South Korea's KOSPI index fell as much as 6.1% on Friday, with Samsung Electronics and SK Hynix both dropping over 7%, prompting the Korea Exchange to temporarily halt program trading. In recent weeks, this safety measure has been triggered with increasing frequency in South Korea's $4.1 trillion stock market. Friday's sell-off came as investors sought to reduce risk before the weekend, with Middle East tensions pushing oil prices near $100 per barrel.

After four consecutive days of net buying, global investors resumed selling in South Korean stocks, mainly reducing holdings in tech stocks. Shawn Oh, head of Korean cash equities at NH Investment & Securities, said: "With ongoing Middle East tensions, local funds are reducing tech stocks and lowering risk before the weekend, amplifying the downside risk."

Roy Lim, an equity sales trader at Samsung Securities, said some Asian hedge funds are selling shares in Samsung Electronics and SK Hynix to increase holdings in China's CXMT, which will list on July 27. (Jinshi Data)