Kospi Closes Down 3.59 Percent in Asia Chip Rout as Bitcoin Drops Below $77,000

Updated 07:34 UTC, Nov 3

Seoul's market has closed. The Kospi finished at 5,648.79 on Tuesday, November 3, down 210.29 points, or 3.59 percent, Yonhap reported. The index had opened 2.46 percent lower. The Seoul Economic Daily printed the same close, 5,648.79, down 3.59 percent, at 3:34 p.m. Korea time.

Samsung Electronics closed down 4.59 percent at 218,500 won, and SK Hynix fell 5.71 percent at the close to 1,388,000 won, TradingKey reported.

The fall followed a weaker night on Wall Street. The Nasdaq Composite fell 1.07 percent and the S&P 500 fell 0.51 percent, and the PHLX chip index fell 3.4 percent after a 7.2 percent fall on Friday, Yonhap reported. Investors stayed cautious ahead of the start of voting in the United States midterm elections. Japanese markets were closed on Tuesday for the Culture Day holiday. The Korean won traded higher against the US dollar on Tuesday, Yonhap reported.

The earlier intraday report follows.

South Korea's Kospi index fell 4.06 percent in intraday trade on Tuesday, November 3, as a selloff in Asian chip stocks deepened and Bitcoin dropped below $77,000. At 1:55 p.m. Korea time, the Kospi traded at 5,621.15, down 237.93 points from the previous close, MoneyToday reported. The Kosdaq index traded at 703.85, down 30.51 points or 4.15 percent. Both figures are intraday readings from before the close. Seoul's market closes at 3:30 p.m. Korea time, and the final close is in the update above.

Updated 07:31 UTC: Taiex closes down 3.59 percent and silver falls 3.3 percent

Taiwan's Taiex index closed down 3.59 percent at 43,307.54, from a previous close of 44,920.14, a deeper fall than the 3 percent intraday drop reported earlier in this story. The selling stayed centred on chip stocks as investors cut Asian technology shares over concern that heavy spending on artificial intelligence will not earn adequate returns. Reuters reported that Taiwanese shares fell in early trade on Tuesday, with investors on edge ahead of voting in the US midterm elections.

Silver fell 3.3 percent to $49.045 an ounce, from $50.72. Reuters reported spot silver down 1.8 percent at $49.71 an ounce in early trade, and said gold was being sold as a liquid asset to cover losses and margin calls elsewhere, rather than bought as a safe haven. Traders put a 74 percent chance on a Federal Reserve rate hike in December, Reuters said. CNBC TV18 reported gold and silver trading lower on Tuesday on expectations of higher US interest rates for longer.

South Korea's Kospi index fell 4.06 percent in intraday trade on Tuesday, November 3, as a selloff in Asian chip stocks deepened and Bitcoin dropped below $77,000. At 1:55 p.m. Korea time, the Kospi traded at 5,621.15, down 237.93 points from the previous close, MoneyToday reported. The Kosdaq index traded at 703.85, down 30.51 points or 4.15 percent. Both figures are intraday readings. Seoul's market closes at 3:30 p.m. Korea time, and this report will be updated after the close.

Chip stocks lead the fall

Nine of the top 10 Kospi stocks by market value fell, MoneyToday reported. SK hynix and SK Square dropped more than 5 percent. Samsung Electro-Mechanics plunged about 7 percent. Samsung Electronics fell in the 4 percent range, LG Energy Solution fell more than 4 percent and Hyundai Motor fell more than 3 percent. Samsung Biologics was the only gainer among the top 10, rising in the 1 percent range.

Foreign investors were net sellers of 1.3072 trillion won of Kospi shares, and institutions were net sellers of 455.6 billion won. Retail investors moved the other way and were net buyers of 1.4931 trillion won, MoneyToday reported.

The rout spreads across the region

Taiwan's weighted index fell 3 percent to 43,570.41 points intraday, and Indonesia's benchmark extended its intraday loss to 2 percent, TokenPost reported, citing market data. The Shanghai Composite fell 0.71 percent.

Reuters, in a report carried by Finimize, said the selloff centred on Asia's chip supply chain. In an earlier reading the Kospi fell 3.2 percent, with SK Hynix down 4.8 percent and Samsung Electronics down 3.7 percent. Taiwan's benchmark fell more than 2 percent to its lowest level since early August and stood more than 10 percent below its October 6 record high. The MSCI Emerging Asia index fell 1.5 percent.

Outlets reporting the move linked it to a deepening selloff in United States chipmakers, on concern over the profitability of investment in artificial intelligence. CoinDesk reported that a gauge of US chipmakers had extended a three day rout to 12 percent and that the Nasdaq 100 had fallen 10 percent from its peak, entering correction territory.

Bitcoin falls with the chip stocks

Bitcoin fell 2 percent to just under $77,000 on Tuesday morning in Asia, CoinDesk reported. The price fell below the roughly $77,600 level it dipped to late on Sunday. Ether fell about 2 percent to just above $2,250. Solana dropped 3 percent to about $92, BNB lost 2 percent and slipped below $700, and ZEC fell nearly 10 percent to about $1,140.

India moves the other way

India diverged from the regional selloff in early trade. The Sensex opened up 459.68 points or 0.61 percent at 76,152.46, and the Nifty gained 109.60 points or 0.47 percent to 23,550.40, The Hindu BusinessLine reported in its live market coverage.