Samsung lifts KOSPI as court curbs planned strike

South Korea’s Kospi rose 0.31% on May 18, rebounding from the previous session’s more than 6% drop as investors bought chip stocks including Samsung Electronics, while the won edged up against the US dollar.

The index opened lower and fell about 5% in early trading, triggering a five-minute sell-side sidecar.

It later turned positive after a court partially granted Samsung Electronics’s request to block a planned strike and wage talks resumed with its largest union.

Foreign investors sold a net 3.7 trillion won (US$2.45 billion) for an eighth straight session, while institutions and retail investors bought 1.4 trillion won (US$931 million) and 2.2 trillion won (US$1.48 billion).

Samsung up 3.88%, SK hynix up 1.15%, and Hyundai Motor down 5.29%.

🔗 Source: Yonhap

🧠 Food for thought

Implications, context, and why it matters.

Kospi swings after a steep run-up and heavy foreign selling

The Kospi has turned choppy after climbing 82% since the start of the year, leaving it among the world’s most volatile major stock indexes 1 2.
Overseas investors have locked in gains after the rally, with net outflows topping US$2.8 billion in one recent day 2.
The pullback hits hard because Samsung Electronics and SK hynix, two memory chip makers, account for about half of the Kospi’s weighting 2.
Foreign selling has also centered on Samsung Electronics, with net sales reaching 11.4 trillion won (US$7.63 billion) from May 7 to May 13 1.

A Samsung strike could hit South Korea’s economy

The planned walkout carries national stakes because semiconductors make up 38% of South Korea’s total exports 3.
Losses could reach 1 trillion won (US$671 million) a day. A longer disruption could also put Nvidia, the leading AI chip designer, at risk as a customer 3.
South Korea’s labor minister can suspend industrial action for 30 days through an “emergency adjustment of industrial action” if a strike is likely to hurt the economy or disrupt daily life 3.
South Korea has used this measure only four times, with the last case in 2005 3.