South Korea's Kospi Tumbles Nearly 5% as Chip-Rally Doubts Grow

South Korea's benchmark Kospi index tumbled nearly 5% to close around 7,656 on 7 July, extending losses as investors grew increasingly cautious about whether the powerful rally in semiconductor stocks can continue. The slide came even though Samsung Electronics reported record preliminary second-quarter earnings that beat expectations, with the strong results largely seen as already priced in after a huge run-up, and followed a warning from a major brokerage about fading momentum for chip shares. Battery makers also weighed on the market after one leading manufacturer posted quarterly profit well below forecasts, reinforcing concerns over soft global electric-vehicle demand. The moves are part of a period of extraordinary volatility for the Kospi, which has surged sharply this year on optimism about the artificial-intelligence memory-chip cycle, at one point overtaking major global peers, but has also seen days of double-digit swings and trading halts. Foreign and institutional investors have been locking in profits after the index's strong gains, and the whipsaw trading highlights how heavily South Korea's market now depends on sentiment toward a handful of AI-linked technology giants.