KOSPI Plunges 9% on July 13 as SK Hynix Hits 29-Year Record Low

South Korea's benchmark KOSPI index fell 9% (669 points) to close at 6,806.93 on July 13, marking the steepest single-day decline in two months, according to Donga Ilbo. SK Hynix led the selloff with a 15.37% drop—its largest daily loss since its December 1996 IPO—after Korean Investment & Securities lowered its Q2 operating profit forecast to 6.04 trillion won from the consensus estimate of 6.5 trillion won. The broader market lost 546 trillion won in market capitalization in a single session.

The sharp decline reflects a liquidity shift as foreign investors pursued an arbitrage strategy recommended by UBS: buying SK Hynix's newly listed Nasdaq ADR at $168.01 (up 12.76% from the $149 IPO price) while simultaneously selling shares on the domestic KOSPI. Foreign investors net-sold over 3.1 trillion won of SK Hynix across two trading sessions. Single-stock leveraged ETFs tracking Samsung Electronics and SK Hynix at 2x daily returns amplified volatility, falling 20-30% each.