South Korea halts stock trading as KOSPI plunges over 8% amid tech-led selloff

South Korea’s stock market suspended trading for 20 minutes on Monday after the KOSPI index dropped more than 8% in early trade, exceeding volatility thresholds. The Korea Exchange activated a circuit breaker following extreme losses in technology and semiconductor stocks, key sectors for South Korea’s export-driven economy. The selloff followed a 4.2% Nasdaq decline on Friday, marking the worst one-day rout for tech stocks since March 2020. Investors reduced exposure to high-growth companies after stronger-than-expected US jobs data for May raised concerns about persistent inflation and delayed Federal Reserve rate cuts. The downturn reversed a nine-week US equity rally fueled by AI optimism and expectations of lower interest rates. Rising US Treasury yields, particularly two-year yields up over 11 basis points, further pressured growth stocks by reducing their future earnings value. Asian markets entered Monday under broad-based pressure, with futures signaling steep losses for South Korea and Japan. Analysts cited elevated tech valuations, rising bond yields, and uncertainty over monetary policy as key factors. Geopolitical tensions in West Asia, including Israel’s strikes on Beirut and Iran’s retaliatory missile attacks, added to market jitters. Oil prices surged over 2.5% to $95 a barrel as OPEC+ agreed to raise output targets for a fourth consecutive month, compounding investor concerns. The combination of economic data, monetary policy uncertainty, and geopolitical risks deepened the selloff across Asian equities.