South Korean equities saw a massive outflow in July 2026 as foreign investors withdrew around $13 billion, intensifying a selloff that sent the KOSPI index down 33% from its June highs. This dramatic decline erased nearly $2 trillion in market value within weeks, with one late July session wiping out 16% and triggering circuit breakers.
Despite this exodus, chipmakers Samsung Electronics and SK Hynix attracted selective buying. These two tech giants make up more than half of KOSPI’s market capitalization and remain critical players in the global semiconductor industry, especially amid the AI boom driving demand for advanced memory chips.
The semiconductor sector is not without challenges. SK Hynix reported disappointing earnings fueled by margin pressure from falling memory chip prices and rising competition from China’s CXMT, which is steadily ramping up DRAM production and exerting pricing pressure. Still, investors betting on the long-term AI infrastructure trend saw value in the 33% price drop, continuing to back these companies even as the broader market tumbled.
