KOSPI Plunges 22% in July as Retail Investors Vow to Halt Stock Purchases

KOSPI hits deepest monthly drop since financial crisis with $54.2B retail inflows reversing. Government pauses leveraged ETF listings amid investor backlash.

Woofun AI data shows that the South Korean KOSPI Index declined 22% in July, marking its largest monthly drop since the global financial crisis. Despite a record 18% surge on Friday, retail investors executed record net selling, reversing $54.2 billion in purchases made between May and June. Samsung Electronics and SK Hynix fell 21% and 35% respectively, triggering circuit breakers four times.

The South Korean government temporarily suspended new single-stock leveraged ETF listings to stabilize markets.

However, retail investors criticized the measures as insufficient, with some vowing to exit the market entirely. Analysts attribute the volatility to crowded trades and leverage, noting that deleveraging may continue to cause significant swings in technology stocks.