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South Korea's bourse operator, the Korea Exchange (KRX), has activated a buy-side sidecar for the benchmark Korea Composite Stock Price Index (KOSPI) on multiple occasions as the index surged sharply, driven by gains in technology and semiconductor shares. The sidecar mechanism, which suspends program trading for KOSPI-listed shares for five minutes, is triggered when the KOSPI 200 Futures index rises 5 percent or more for at least one minute, according to Yonhap News Agency reports.

Coverage Comparison

Yonhap News Agency, South Korea's leading wire service, has reported on at least eight separate instances of the sidecar activation, each with distinct market conditions and triggers. The reports span from late June to early August, with the KOSPI showing significant volatility during this period.

In one instance, on June 25, the KOSPI rose 431.95 points, or 5.1 percent, to 8,902.97 as of 9:09 a.m., with program trading suspended shortly after the market opened. The surge was attributed to investors scooping up semiconductor shares following U.S. chipmaker Micron Technology's better-than-anticipated quarterly earnings.

On July 3, the KOSPI added 410.29 points, or 5.36 percent, to 8,058.38 as of 1:57 p.m., with program trading suspended at around 1:50 p.m. This rise was linked to reports that AI startup Anthropic is in talks with Samsung Electronics to develop a custom AI chip, leading investors to snap up semiconductor shares. The rebound came after the index plunged 7.89 percent the previous day, dragged down by a sharp sell-off in Samsung Electronics and SK hynix amid concerns that the AI-driven rally might have peaked.

On July 10, the KOSPI rose 408.4 points, or 5.6 percent, to 7,700.32 as of 1:10 p.m., with program trading suspended at 12:54 p.m. The rise was attributed to U.S. stocks closing higher in overnight trading, buoyed by a strong rebound in semiconductor shares and easing oil prices.

On July 15, the KOSPI rose 450.68 points, or 6.57 percent, to 7,307.51 as of 9:12 a.m., with program trading suspended at 9:06 a.m. The rise was again linked to U.S. stocks closing higher, buoyed by a strong rebound in semiconductor shares and a softer-than-expected consumer price index.

On July 21, the KOSPI rose 267.04 points, or 4.18 percent, to 6,788.51 as of 12:43 p.m., with program trading suspended at 12:41 p.m. On July 22, the KOSPI rose 6.01 percent to 7,153.42 points as of 9:11 a.m., with program trading suspended at 9:06 a.m. On July 31, the KOSPI surged 11.05 percent as of 9:07 a.m., with program trading suspended at 9:06 a.m. On August 5, the KOSPI climbed 4.53 percent as of 9:27 a.m., with program trading suspended at 9:25 a.m., amid hopes for a possible agreement between the United States and Iran over the Strait of Hormuz and eased woes over artificial intelligence investment.

Key Claims

  • The buy-side sidecar is triggered when the KOSPI 200 Futures index rises 5 percent or more for at least one minute, as reported by Yonhap News Agency.
  • Program trading for KOSPI-listed shares was suspended for five minutes in each instance, according to the Korea Exchange.
  • The KOSPI showed significant gains in each instance, with percentage increases ranging from 4.18 percent to 11.05 percent, as reported by Yonhap.
  • The surges were attributed to various factors, including U.S. stock gains, semiconductor rallies, Micron Technology's earnings, reports of Anthropic-Samsung talks, and hopes for a U.S.-Iran agreement, as reported by Yonhap.
  • The index had plunged 7.89 percent on July 2, dragged down by a sell-off in Samsung Electronics and SK hynix, as reported by Yonhap.