US Market Analysis and Korea Daily Briefing — 2026-07-18

Yesterday’s US Market Summary

The U.S. market struggled due to widespread weakness in the semiconductor sector. The Nasdaq Composite finished down 1.47% at 25,881, while the S&P 500 fell 0.51% to 7,533. The Dow Jones Industrial Average dropped 105.02 points (-0.20%) to close at 52,553.

The semiconductor sector crisis was triggered by growing doubts over the justification for AI investments. As share prices for chip manufacturers remain weak, there is mounting concern that the broader sector is entering a bear market.

Key Themes and Issues in the Korean Market

1. Large-cap stocks slump amid semiconductor industry recession

The Korean market experienced a massive panic sell-off following the semiconductor weakness in the U.S. The KOSPI closed down 6.37% at 6,820.60, erasing the gains that allowed it to reclaim the 7,000 mark just yesterday.

The KOSDAQ fell 4.53% to 791.84. A sidecar (circuit breaker) was activated shortly after the market opened to handle the massive volatility, but foreign and institutional selling only widened the losses.

2. Sharp declines for Samsung Electronics and SK Hynix

Samsung Electronics fell to 253,000 KRW, while SK Hynix collapsed below the 1,825,000 KRW level. The downturn in the domestic semiconductor leaders was directly driven by concerns over the deteriorating U.S. semiconductor industry outlook.

3. Bank of Korea rate hike worsens investor sentiment

Compounding the pressure from U.S. chip stocks, the Bank of Korea’s base rate hike further damaged domestic investor sentiment. Concerns regarding capital outflows and risk aversion triggered by the rate hike amplified the market’s decline.

Recommended Stocks to Watch

Given the broad correction in the domestic market due to semiconductor weakness, an investment diversification strategy focusing on oversold stocks and sectors with policy-driven tailwinds is advisable.

• SK Hynix (SKHY): As a leading indicator for the semiconductor industry, it is highly likely to react first to a recovery in AI memory demand. The current deep discount is being viewed as a potential buying opportunity.

• Samsung Electronics: This large-cap stock is expected to lead a recovery once signs of a bottom in the semiconductor cycle emerge, and long-term earnings expectations remain intact.

• Shipbuilding, Cosmetics, and Retail: These sectors are preferred in the July domestic market outside of semiconductors and may provide trading opportunities following short-term pullbacks.

• Note: This briefing is for reference only; the responsibility for investment decisions lies solely with the investor.