The KOSPI fell 655.34 points (8.77%) to 6820.6 during the third week of July (July 13-16), with sidecar mechanisms triggering daily and a circuit breaker activating on July 13, according to Korea Exchange data released on July 18. The decline was driven by semiconductor sector concerns following news of US data center construction halts due to power supply and environmental issues, combined with Middle East war uncertainties stemming from continued US-Iran military tensions. The sharp downturn affected the S7 stocks—Samsung Electronics, SK Hynix, SK Square, and four other major companies—which all declined in tandem, while an unusual social media-driven movement pushed several delisted-risk stocks to surge over 70%.
KOSPI Triggers Circuit Breaker and Daily Sidecars During July 13-16 Decline
The KOSPI triggered sidecar mechanisms every trading day during the period: sell sidecars activated on July 13, 14, and 16, while a buy sidecar triggered on July 15. On July 13, the market experienced a circuit breaker activation. According to Korea Exchange, the benchmark index closed the week at 6820.6, down 655.34 points (8.77%) from the previous week.
S7 Stocks Fall 10-20% on Semiconductor Sector Concerns
The S7 group—comprising Samsung Electronics, SK Hynix, SK Square, Samsung Electro-Mechanics, Samsung C&T, Samsung Electronics preferred shares, and Samsung Life Insurance—declined in unison. Samsung Electro-Mechanics dropped 19.38%, SK Hynix fell 15.5%, SK Square declined 13.98%, Samsung C&T dropped 11.62%, Samsung Electronics preferred shares fell 11.48%, Samsung Electronics declined 10.53%, and Samsung Life Insurance dropped 2.79%.
News emerged that data center construction in New York was halted due to power supply and environmental issues, intensifying concerns about semiconductor industry outlook. Among KOSPI-listed companies with market capitalization above 1 trillion won and weekly trading volume exceeding 100 billion won, Kumho Tire recorded the largest decline at 25%. The stock had surged 64.56% from July 6-10 on expectations related to the Honam region semiconductor mega cluster, but profit-taking emerged during the reviewed week.
AI industry beneficiary stocks also appeared among top decliners. Gaon Cable fell 22.71% following news of US data center construction delays due to power supply issues. Samwha Capacitor, a PCB manufacturer, dropped 21.05%.
Delisted-Risk Stocks Surge Over 70% on Social Media-Driven Movement
An unusual phenomenon emerged in the Korean stock market during the third week of July. A movement to support "patriotic companies" that failed to meet KOSPI listing maintenance market capitalization requirements spread through social media platforms. Previously neglected stocks surged sharply.
Individual investors initially focused on Hansung Enterprise and Monami, a stationery company. The movement subsequently spread to other stocks including Enex and Vivien.
During this period, Enex surged 185.2%, recording the highest gain among 944 KOSPI-listed companies. Vivien rose 128.10% (second place), Monami gained 73.89% (third place), and Hansung Enterprise climbed 71.63% (fourth place).
The financial investment industry noted that investors should exercise caution with these companies, as their market capitalization increases were temporary and driven by supply-demand dynamics. Hansung Enterprise and Monami were designated as investment warning stocks, with trading halted for one day on July 16. Enex and Vivien were designated as investment caution stocks.
SK E&S Rises 21.35% on Government Renewable Energy PPA Platform News
Among stocks with market capitalization above 1 trillion won and weekly trading volume exceeding 100 billion won, SK E&S recorded the largest gain, rising 21.35%. SK E&S operates as a renewable energy company with businesses spanning solar power, wind power, fuel cells, and ESS (Energy Storage Systems).
Investor sentiment was stimulated by news that the government would operate a pilot program for a Power Purchase Agreement (PPA) intermediary platform connecting power generation businesses and companies seeking to buy and sell renewable energy electricity online. On July 13 and 16, Kyobo Securities and Hana Securities raised SK E&S's target price. Yoo Jae-sun, a Hana Securities researcher, stated, "SK E&S is expected to expand its market share in the renewable energy PPA market."
As war uncertainties emerged and international oil prices rose, energy stocks gained prominence. SK Innovation rose 17.89%, recording the second-highest gain. S-Oil also climbed 9.69%.
FAQ
What caused the KOSPI to fall 8.77% during July 13-16?
The KOSPI declined due to semiconductor sector concerns following news of US data center construction halts caused by power supply and environmental issues, combined with Middle East war uncertainties from continued US-Iran military tensions.
Which stocks experienced the largest gains during the third week of July?
Among stocks with market capitalization above 1 trillion won and weekly trading volume exceeding 100 billion won, SK E&S rose 21.35% (first place) on government renewable energy PPA platform news, SK Innovation gained 17.89% (second place), and S-Oil climbed 9.69% as energy stocks benefited from war uncertainties and rising international oil prices.
