Midterm shock trips Seoul circuit breaker as chips slide

The Democrats’ sweep of the US Congress in the November midterm elections has hit Korea’s two memory chipmakers twice: first in the early reassessment on Nov 5, then in a rout in Seoul on Friday, Nov 6.

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A rout that halted the Seoul market

Shares of Samsung Electronics and SK hynix each lost close to 10% during Friday’s trading, according to both The Korea Times and The Korea Herald.

The outlets gave different reasons. The Korea Herald tied the slide to a steep overnight drop in large US technology stocks after the vote, and its headline pointed to widening concern over AI data centers. The Korea Times described the selling as panic and linked it to fears that the cycle of AI spending may be nearing its peak.

The KOSPI, Korea’s main stock index, started the day at 5,263.63, down 2.2% from its prior close, The Korea Herald reported. The losses then deepened. Three minutes into the regular session, a first-stage circuit breaker, an automatic pause for the whole market, stopped trading for 20 minutes, according to The Korea Herald. The Korea Herald also reported that falling chip shares dragged the index under 5,000 points during the session.

The damage reached beyond Seoul. At 09:59 KST, CNBC reported that the losses on the Nasdaq were spreading to Asian chip stocks, with SoftBank declining along with SK hynix and Samsung.

Friday’s drop came after an already heavy Thursday. The KOSPI had ended Nov 5 at 5,383.8, down 5.28% for that session. Samsung Electronics closed the same day at 201,500 won (about US$150.14), 7.57% below its Nov 4 close.

A Democratic Congress puts memory’s record run in question

Democrats won control of both chambers of the US Congress, The Korea Times and DigiTimes reported.

The Korea Times wrote on Nov 5 that the “blue wave,” as it called the result, is expected to cool demand for memory chips as well as their prices. It added that the outcome raises doubts over whether Samsung Electronics and SK hynix can extend their streak of record earnings.

DigiTimes took a two-sided view. It reported that industries across South Korea are weighing what the result means for investment, trade and technology policy. For Samsung and SK hynix, DigiTimes described the outcome as carrying risks around AI data centers alongside openings tied to the CHIPS Act.

SK hynix shares closed at 1,264,000 won (about US$941.81) on Nov 5, down 9.46% from 1,396,000 won one session earlier. The TIGER 200 ETF, a fund that stands in for the KOSPI 200 index of large Korean companies, lost 5.78% over the same session.

The record run in question is recent. On Oct 28, SK hynix filed preliminary third-quarter results, meaning figures that can still change in the final report. They showed consolidated operating profit of 83.33 trillion won (about US$62.1 billion) on revenue of 104.62 trillion won (about US$78.0 billion). That profit was 632.1% higher than a year earlier and the largest of any quarter since at least the second quarter of 2025.

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Information only, not investment advice.