Markets
KOSPI Index Falls 5% Amid Concerns Over Chinese Chipmaker CXMT's Advances
South Korea’s KOSPI index experienced a significant decline of nearly 5%, reaching 6,100 on Tuesday morning, primarily influenced by advancements from Chinese chipmaker ChangXin Memory Technologies (CXMT). This downturn follows a 3.7% drop on Monday, marking a total decline of 10.1% over five days, although the index is still up 44.89% for 2026.
CXMT, China’s largest memory producer, made headlines over the weekend by reporting progress on a denser 4F² chip design, which is projected to enhance memory density by 30% to 50%, according to TrendForce estimates. The company aims to commence shipping server memory based on this new design by the end of the year, entering a high-value market where Samsung and SK Hynix are key competitors.
As a result of these developments, both Samsung Electronics and SK Hynix saw their stock prices drop approximately 5% by 9:13 a.m. in Seoul. Foreign investors sold a net 341.4 billion won worth of shares, while individual and institutional investors were net buyers. The KOSPI opened the day nearly 5% lower.
Additionally, the impact of CXMT's advancements was felt in the U.S. market, with Micron and Sandisk shares falling by 3.9% and 6%, respectively, during overnight trading. Analysts have noted that CXMT still faces challenges in stabilizing yields on high-bandwidth memory, while Samsung and SK Hynix are already sampling the newer HBM4E generation.
Historically, Korean chip stocks have reacted sharply to CXMT's developments, as evidenced by an 8% drop in the KOSPI following CXMT's debut in Shanghai in July. With Samsung and SK Hynix accounting for over half of the KOSPI's market value, concerns about their dominance in the DRAM market are now influencing the broader market sentiment.
Despite the current downturn, some analysts, such as Kiwoom Securities researcher Han Ji-young, anticipate that dip buying could lead to a rebound during the trading session. The KOSPI is currently trading over 30% below its peak of 9,000 reached in June.
FAQ
What caused the KOSPI index to fall nearly 5%?
The KOSPI index fell nearly 5% due to advancements from Chinese chipmaker ChangXin Memory Technologies (CXMT), which reported progress on a denser chip design expected to enhance memory density significantly.
How much has the KOSPI index declined over the past week?
The KOSPI index has declined a total of 10.1% over the past five days, following a 3.7% drop on Monday.
What impact did CXMT's advancements have on Samsung and SK Hynix stocks?
As a result of CXMT's advancements, both Samsung Electronics and SK Hynix saw their stock prices drop approximately 5% by 9:13 a.m. in Seoul.
What is the projected timeline for CXMT to start shipping its new chip design?
CXMT aims to commence shipping server memory based on its new chip design by the end of the year.
What do analysts predict for the KOSPI index moving forward?
Some analysts, like Kiwoom Securities researcher Han Ji-young, anticipate that dip buying could lead to a rebound during the trading session, despite the current downturn.