# Memory-Chip Selloff Spreads to Seoul, Driving the Kospi Down About 5 Percent

Foreign investors sold more than 500 billion won of Korean shares in a single session as SK Hynix and Samsung Electronics extended losses that began with weak guidance from SanDisk.

- Published: 2026-08-06T05:15:29.911Z
- Canonical: https://polylog.news/2026-08-06/memory-chip-selloff-spreads-to-seoul-driving-the-kospi-down
- Publisher: Polylog (Global desk)
- Section: markets
- Sources: [Economic Times](https://m.economictimes.com/markets/us-stocks/news/south-koreas-kospi-tumbles-5-after-2-day-rally-angry-retail-investors-vow-not-to-invest-again/articleshow/132980706.cms), [Globes (Hebrew)](https://www.globes.co.il/news/article.aspx?did=1001551552#utm_source=RSS), [Seoul Economic Daily](https://en.sedaily.com/finance/2026/08/06/samsung-falls-3-percent-sk-hynix-7-percent-as-foreign)

South Korea's benchmark index reversed a two-day rally on Thursday. The Kospi [fell about 5 percent at its worst point](https://m.economictimes.com/markets/us-stocks/news/south-koreas-kospi-tumbles-5-after-2-day-rally-angry-retail-investors-vow-not-to-invest-again/articleshow/132980706.cms) and the exchange activated its sidecar mechanism, which suspends program sell orders. SK Hynix fell more than 7 percent and Samsung Electronics also declined, while [foreign investors turned net sellers of more than 500 billion won](https://en.sedaily.com/finance/2026/08/06/samsung-falls-3-percent-sk-hynix-7-percent-as-foreign) after buying in recent sessions.

The selling began with results reported in New York. SanDisk reported revenue of $8.96 billion for its fiscal fourth quarter, but guided first-quarter revenue to a midpoint near $10.55 billion, below the roughly $10.8 billion analysts expected. Memory shares had already fallen through late July. SanDisk was down about 45 percent over the previous month, and the planned initial public offering of the Chinese memory maker CXMT added further pressure.

The Israeli business daily Globes covered the same session from an Israeli perspective, reporting [declines across Asia led by Korea and stability in oil prices and on Wall Street](https://www.globes.co.il/news/article.aspx?did=1001551552#utm_source=RSS), alongside more than $1 billion of combined market value lost overnight by the Israeli-linked companies Taboola and SolarEdge.

United States indexes moved in opposite directions on Wednesday. The Dow Jones Industrial Average rose about 0.5 percent while the Nasdaq Composite fell about 0.8 percent. That divergence indicates capital leaving artificial-intelligence hardware stocks rather than leaving equities altogether. Korean retail investors, many of whom bought the memory stocks as prices rose, are absorbing the concentrated losses.

## What this means

Index concentration transmits a single company's guidance miss across borders within hours. Korea's market is unusually exposed because two memory manufacturers carry a large share of the Kospi, so a downgrade to expected memory pricing affects the national index, the won and household balance sheets at the same time. The channel is earnings expectations rather than credit. Buyers financed a capacity build on assumed artificial-intelligence demand, and each guidance disappointment forces a repricing of that assumption. Exporters of memory equipment and Korean retail investors lose, while the Dow-listed industrial and financial names absorbing the rotation gain.

## What to watch

- Whether CXMT's listing prices at a level that implies more Chinese memory supply, which would push down contract prices for Samsung and SK Hynix rather than only their share prices.
- Whether foreign net selling in Seoul continues for several sessions, which would signal a positioning change rather than one day of risk reduction.
- The next round of memory contract price data, which shows whether the demand slowdown is real or only a problem of expectations.