The KOSPI, which staged its biggest rally on record on July 31, reversed sharply lower just one day later. Samsung Electronics (005930) and SK Hynix (000660), the two largest stocks by market capitalization, both plunged around 8% on profit-taking, dragging the index down with them.

As of around 9:30 a.m. Monday, Samsung Electronics was trading at 241,000 won (approximately $167.70), down 21,500 won (approximately $14.96), or 8.19%, from the previous session, according to South Korea’s Korea Exchange. SK Hynix was at 1,582,000 won (approximately $1,100.81), down 136,000 won (approximately $94.63), or 7.92%. Both stocks had surged 26.81% and closed at their daily price limits in the prior session, powering the KOSPI’s 17.91% surge — a 1,001.89-point jump — that marked the index’s largest single-day gain ever.

The KOSPI fell 321.79 points, or 4.88%, to 6,273.66, retreating to the 6,200 level. The index touched an intraday low of 6,247.64 at one point. On the main bourse, foreign and institutional investors were net sellers of 1.11 trillion won (approximately $772.7 million) and 247.1 billion won (approximately $171.9 million), respectively, while retail investors bought a net 1.32 trillion won (approximately $917.5 million) to help stem the decline. In the prior session, foreign investors had recorded a record net purchase of 7.28 trillion won (approximately $5.1 billion), only to flip to selling just one day later.

The decline is primarily attributed to profit-taking following the sharp short-term surge on July 31. Adding to the pressure, major U.S. semiconductor stocks including Micron (-5.90%) took a breather on Wall Street, and SK Hynix’s U.S. ADRs fell 3.54%, dampening investor sentiment. U.S. markets, however, saw all three major indices rise, buoyed by Amazon’s better-than-expected earnings. President Donald Trump’s abrupt cancellation of military operations against Iran, which eased Middle East tensions, also provided a supportive backdrop — but it wasn’t enough to overcome the wave of profit-taking.

Securities firms are characterizing this pullback as a cooling-off phase rather than a trend reversal, with expectations that the market will resume its recovery with a higher floor after the short-term speed adjustment. “Given that the KOSPI surged more than 17% in a single day — the largest daily gain on record — some temporary profit-taking and speed-adjustment selling is likely early this week,” said Han Ji-young, an analyst at Kiwoom Securities. “But the market remains deeply in oversold territory, with July’s monthly return of -22.1% ranking as the third-worst since 1990.”

Views on semiconductor stock valuations are divided across the brokerage industry. Shinhan Investment Corp. cut its target price for Samsung Electronics from 590,000 won (approximately $410.54) to 450,000 won (approximately $313.13), and for SK Hynix from 4.2 million won (approximately $2,922.51) to 2.7 million won (approximately $1,878.76). Samsung Securities also lowered its targets, trimming Samsung Electronics from 500,000 won to 400,000 won and SK Hynix from 3.5 million won to 3.0 million won. “The aggressive share price correction stems from excessive investment crowding ahead of the memory upcycle, rather than peak-out concerns,” said Lee Jong-wook, an analyst at Samsung Securities.

Korea Investment & Securities, by contrast, took a differentiated stance, raising target prices for both stocks — Samsung Electronics from 590,000 won to 650,000 won (approximately $452.29) and SK Hynix from 3.8 million won (approximately $2,644.18) to 4.7 million won (approximately $3,270.43). “The market is pricing in doubt, but solid fundamentals are being proven through earnings,” said Chae Min-sook, an analyst at Korea Investment & Securities. “This is a time to focus on the direction of corporate value and earnings rather than short-term volatility.”

Based on July 31 closing prices of 262,500 won (approximately $182.66) for Samsung Electronics and 1,718,000 won (approximately $1,195.45) for SK Hynix, the average target price premium over the past month stands at roughly 96% for both stocks. Brokerages had slashed target prices in droves during the “three dark days” (July 28–30), but the share price declines were even steeper.

CategorySamsung ElectronicsSK HynixPrevious session close262,500 won1,718,000 wonMonday intraday (9:30 a.m.)241,000 won1,582,000 wonChange-8.19%-7.92%1-month average target price514,545 won (approximately $358.04)3,371,538 won (approximately $2,346.04)

Note: Target prices are based on Yonhap Infomax consensus estimates; the target price premium represents the average target price’s excess over the closing price.

Market attention now shifts to U.S. semiconductor earnings due this week. AMD kicks things off with its results after the market close on Tuesday, followed by SanDisk and Western Digital. “The key question is the strength and durability of the share price recovery, which will be determined by U.S. July employment data, AMD and SanDisk earnings, and shifts in foreign investor flows,” Han said. “For AMD, the watch points are whether AI GPU and server CPU demand are growing simultaneously, whether revenue growth is translating into gross margin improvement, and whether Q3 data center guidance signals further growth.” SanDisk’s results are expected to directly influence the memory peak-out narrative.

Kiwoom Securities projects the KOSPI will trade in a range of 6,000 to 7,800 points this month, with a rebound likely as U.S. big tech earnings restore semiconductor investment sentiment. However, the 10-year U.S. Treasury yield breaking above 4.7% is cited as a headwind. With yields rising following the hawkishly interpreted July FOMC meeting, analysts say the market needs to confirm whether tightening concerns ease as it digests employment and inflation data.