Asia's AI Chip Trade Broke in a Single Session and Tripped Korea's Circuit Breaker

Korea's benchmark index closed on 28 July at 6,023.66, down 10.84% — a three-month low and the steepest fall since March. Trading was halted for twenty minutes when the circuit breaker fired at 01:13:43 UTC, the eighth such halt of 2026 and the fourteenth in the market's history. Sidecars triggered on both the KOSPI and the KOSDAQ.

The damage

Memory took the worst of it. SK Hynix closed down 14.65% at ₩1,550,000 and Samsung Electronics down 13.39% at ₩220,000. In Japan, Kioxia fell 18.33% to ¥44,550, its lowest since 15 May, and the Nikkei 225 lost 2,566 points to close at 62,364.92, down 3.95%. Taiwan's TAIEX shed 2,030 points to 41,603.36, down 4.65% on turnover of NT$809.5 billion — its third-largest point drop on record. MediaTek fell around 10%.

What actually triggered it

Three inputs, all supply-side. The report that China has begun building its own immersion DUV lithography tools; the arrival of Chinese memory makers on public markets reviving oversupply fears; and Nvidia's reported $250 billion guarantee behind an OpenAI data-centre lease. A Mirae Asset analyst put the memory concern precisely: the worry is "less in CXMT's current earnings and more in its potential for accelerated capacity expansion."

Why the numbers disagree

Coverage of this session quotes the KOSPI as down 8.02%, 8.04%, 7.41%, 10.5% and 10.84%. None of them are wrong; they are different clocks. The 8.02% figure is the level at which the circuit breaker fired, 7.41% was an intraday print, and 10.84% is the close. The same applies to the individual names — SK Hynix was down 7.87% pre-market and 11.1% at mid-morning before finishing at 14.65%.

The part worth keeping in proportion

This is the second fall of roughly this size in July: the KOSPI dropped about 9% on the 13th, with SK Hynix off 15.4% and Samsung 10.7%. It is severe, not unprecedented. And the direction is notable — SK Hynix reports second-quarter results on 29 July, with record profit expected. The selling is positioning ahead of good numbers, on the theory that the supply side has changed underneath them.