Why the KOSPI fell again — a strong won, chip bonuses and 2.6T won of foreign selling
On October 7, 2026, Korea's KOSPI fell 1.98% to 6,803.90, its second straight decline, and foreign investors net sold about 2.6 trillion won (roughly $1.9 billion) on the main exchange. Wall Street had set a record the day before, so the selling was about Korea's chip giants themselves. SK Hynix's U.S.-listed shares had dropped 6.39% overnight on concern that a stronger won shrinks the won value of dollar chip sales and that big employee bonus provisions, after last year's record profit, will weigh on third-quarter earnings. Caution before Samsung Electronics' preliminary results on October 8 and Houthi attacks on Saudi airports, which kept oil and U.S. yields high, added pressure
The three lines
- Result — KOSPI 6,803.90 (−1.98%), KOSDAQ 898.43 (−2.34%) on Oct 7; foreigners sold ~2.6T won
- Cause — SK Hynix ADR −6.39%: strong won and bonus provisions may cut Q3 profit
- Also — wait for Samsung's Oct 8 results; Houthi strikes on Saudi Arabia kept Brent near $100
Key questions
- Why did KOSPI fall on October 7 2026
- **Worry about chip earnings quality, not the U.S. market.** | Factor | Detail | |---|---| | SK Hynix ADR | −6.39% to $182.56 on Oct 6 (U.S. time) | | Strong won | ~1,340 per dollar, shrinking won value of exports | | Bonus provisions | Record 2025 profit → large Q3 charge | | Earnings wait | Samsung preliminary results Oct 8 | | Middle East | Houthi strikes on Saudi airports; oil and yields up |
- How does a strong won affect Korean chipmakers
- **Dollar revenue converts into fewer won.** | Example | 1,470 won/$ | 1,340 won/$ | |---|---|---| | $10B of sales in won | 14.7T won | 13.4T won | | Difference | — | ~1.3T won (~9%) less | The won strengthened from around 1,560 in July to the 1,340s in September.
- What are SK Hynix bonus provisions
- **Money set aside now for bonuses paid later.** | Item | Detail | |---|---| | Accounting | Booked as an expense in the quarter earned | | SK Hynix pool | 10% of operating profit, no cap (labor agreement) | | Payout (reported) | 60% in shares, cash top-up if the stock falls | | Effect | Bigger profits mean bigger provisions |
Wall Street was at a record; Seoul fell for a second day. This time the issue was less interest rates than the quality of chip profits. On October 7, 2026, the KOSPI closed down 137.49 points (1.98%) at 6,803.90. Foreign investors net sold about 2.6 trillion won on the main exchange. A day earlier the trigger had been U.S. long-term yields at a 2002 high; on day two, investors were recalculating what Korea's chip giants will actually earn.
1. What fell first in New York: SK Hynix ADRs, −6.39%
On October 6 (U.S. time) the S&P 500 rose 0.58% to a record, and AI chip names such as Marvell (+5.8%), Broadcom (+3.67%) and AMD (+2.8%) rallied. Yet SK Hynix's American depositary receipts fell 6.39% to $182.56. Memory was the weak spot: Micron −1.73%, SanDisk −2.56%.
| Factor | The concern |
|---|---|
| Strong won | The won moved from around 1,560 per dollar in July to the 1,340s in September, shrinking the won value of dollar chip sales |
| Bonus provisions | SK Hynix's labor deal sets aside 10% of operating profit for bonuses, uncapped. Provisions tied to last year's record profit could weigh on Q3 |
| Demand | AI data-center demand still keeps memory tight; analysts see the issue as currency and one-off costs, not the cycle |
The currency math: $10 billion of chips is 14.7 trillion won at 1,470 per dollar, but 13.4 trillion at 1,340 — about 9% less profit in won for the same volume and dollar price.
2. Seoul on October 7: foreigners erased the rebound
| Item | October 7 |
|---|---|
| KOSPI | 6,803.90 (−137.49, −1.98%) |
| Open | 6,864.25 (−1.11%) |
| Intraday | Rebounded above 6,950 in the morning, then sold off |
| Foreigners (main exchange) | ~2.597T won net sold (~3.1T incl. Nextrade) |
| Institutions | ~672.7B won net sold |
| Retail | ~2.561T won net bought |
| Samsung Electronics | 268,500 won (−1.29%) |
| SK Hynix | 1,723,000 won (−2.82%) |
| KOSDAQ | 898.43 (−2.34%), back below 900 |
| Won/dollar (3:30 p.m.) | 1,340.4 |
Electronics, electrical equipment, steel and autos fell hardest, while consumer names such as cosmetics, apparel and hotels rose. Chip-equipment makers on the KOSDAQ, including Jusung Engineering (−11.13%) and Wonik IPS (−7.22%), slumped. The previous day's rotation into batteries and biotech did not last.
Why do outlets report 2.6 trillion or 3.1 trillion? It depends on whether trading on Nextrade, Korea's alternative exchange launched in 2025, is added to the Korea Exchange total.
3. Three more weights
| Factor | Detail |
|---|---|
| Samsung results | Preliminary Q3 due October 8; consensus operating profit ~105–106 trillion won, about 8.6 times a year earlier |
| Middle East | Yemen's Houthis claimed strikes on Saudi airports and oil sites on October 5–6; Saudi Arabia reported three minor injuries at two southern airports. Brent hovered near $100 |
| LG Electronics | Q3 preliminary results the same day missed expectations |
Samsung's consensus has been trimmed since August as memory price gains slowed and the won strengthened — the same worries that hit SK Hynix's ADRs.
Later on October 7 (U.S. time), Wall Street turned lower: the S&P 500 fell 0.22% to 7,801.77, and the 10-year Treasury yield touched 5.365% intraday, its highest since April 2002, after minutes of the Fed's September meeting showed most officials saw a further hike by year-end as appropriate.
4. What remains unconfirmed
- Samsung's preliminary figures on October 8 are the first test of how much the strong won and one-off costs hit chip profits. Division-level memory profit comes only with final results later in October.
- SK Hynix's actual bonus provision will be visible only in its Q3 report.
- The split of foreign selling between currency worries, U.S. yields and pre-earnings profit-taking cannot be measured.
- Houthi claims about Riyadh's airport and the Rabigh refinery were not independently verified.
Sources
- Newsis — KOSPI retreats on 3 trillion won of foreign selling, closes just above 6,800
- EBN — KOSPI closes down 1.98% at 6,803 as chips weaken before Samsung results
- Global Economic — SK Hynix ADR falls 6.39% on strong won and bonus provisions
- Global Economic — Wall Street falls as Treasury yields spike
- France 24 — Houthis claim attacks on Riyadh airport as Saudi-led forces strike Yemen