After seeming to pare some of its early losses, the domestic stock market slumped sharply again, triggering sell-sidecars in the Korea Exchange main board following the KOSDAQ market.
According to the Korea Exchange (KRX) on the 20th, at 10:52:54 a.m. a temporary suspension of program sell quotes (sell sidecar) was triggered on the KOSDAQ market. About 30 minutes later, at 11:21:26 a.m., a sell sidecar was also triggered on the main board.
Both KOSDAQ and KOSPI saw sell sidecars triggered for the second trading day in a row, following on the 16th.
The market plunged early in the session, then briefly narrowed losses, but selling intensified again, deepening the decline.
As of 11:51 a.m., KOSPI was down 217.66 points (3.19%) from the previous trading day at 6,602.94. At one point intraday, it slid to as low as 6,498.26, losing the 6,500 level.
By investor type, foreigners were net buyers of 403.9 billion won, but individuals and institutions were net sellers of 339.0 billion won and 87.8 billion won, respectively, dragging the index lower. Among institutions, the national pension funds were net buyers of 167.3 billion won.
Large-cap stocks by market capitalization were broadly weaker. Samsung Electronics(005930) and SK hynix each fell about 3%, and all of the top 10 market-cap stocks declined.
A KOSPI sell sidecar is triggered when the nearest-month KOSPI200 futures price falls 5% or more from the previous session's close and remains there for at least one minute. The KOSPI200 futures index fell 5.13% on the day, meeting the condition. When a sidecar is triggered, the effectiveness of program sell quotes is suspended for five minutes.
So far this year, KOSPI sell sidecars have been triggered 20 times, and KOSDAQ sell sidecars 10 times. In particular, on the main board, the number of sidecar activations this year has already reached a record annual high of 38.
Volatility is also growing. In July, up to today, only three out of 13 trading days saw no activation of sidecars or circuit breakers. Expanding the window to the past two months, market stabilization mechanisms have been engaged roughly once every two trading days, with sharp volatility persisting.