Korea Tech Daily — 2026-11-07

Top Story

KOSPI Plunges on AI Regulation Fears; Market Stabilization Fund in Focus

South Korea's benchmark KOSPI index experienced a severe decline, falling more than 5% for a second consecutive day as investors reacted to fears of tighter US regulations on artificial intelligence and a broader sell-off in global tech stocks. The Korea Finance Ministry has pledged preemptive measures, including the potential activation of a market stabilization fund, to counter what officials describe as an "overreaction" to external market shocks. This volatility highlights the fragility of the Korean market's heavy reliance on semiconductor exports amid shifting global sentiment on AI profitability.

Samsung · SK Hynix · LG

Chip Giants Tumble Amid Global Tech Sell-Off Shares of SK Hynix and Samsung Electronics slumped significantly, losing 11% and 8% respectively in early Friday trading, tracking a sharp correction in the Nasdaq Composite. The decline reflects broader anxieties regarding AI debt concerns and a potential slowdown in memory chip demand despite earlier bullish forecasts.

Data Center Stocks Buck the Trend In contrast to the chipmakers, shares of Naver Corp., which has pivoted toward AI infrastructure and data centers, climbed even as the broader market suffered, indicating a sector rotation within the tech landscape. Investors are increasingly distinguishing between hardware manufacturers facing cyclical risks and platform companies building long-term AI software ecosystems.

1 sources

kedglobal.com

s, climbed on Friday even as the country’s stock market suffered a sharp sell-of

Naver · Kakao · LINE

Platforms Race to Launch AI Advertising Agents Naver, Kakao, and other major Korean platforms are aggressively expanding their AI capabilities by launching new advertising agents designed to automate campaign setup, budget adjustments, and performance analysis for advertisers. This move aims to monetize AI infrastructure investments by offering direct value to small and medium-sized businesses.

Capital Rotates to Platform Stocks While semiconductor stocks fell, Kakao and Naver saw surges of around 10%, as money flowed into non-semiconductor sectors such as platforms and biotech. This divergence suggests that investors are seeking exposure to AI application layers rather than just hardware suppliers.

Startups & Investment

VC Funding Hits Five-Month High Driven by Deep Tech South Korea’s venture funding climbed to a five-month high in October, propelled by mega-deals in deep-tech startups, particularly in the AI chip sector. The resurgence in investment highlights continued confidence in Korea's ability to compete in specialized hardware niches despite broader market volatility.

1 sources

kedglobal.com

s, climbed on Friday even as the country’s stock market suffered a sharp sell-of

Policy & Industry

Government Targets Record 21.3 Trillion Won for AI and Semiconductors The South Korean government has announced a record-high 2027 budget allocation of 21.3 trillion won specifically for semiconductors, physical AI, and AI data centers. This massive investment aims to develop a sovereign AI model with "world's highest performance," reducing reliance on foreign tech giants.

What to Watch

• Market Stabilization Measures: Monitor the Korean Finance Ministry's next steps regarding the stabilization fund and potential short-selling bans following the recent KOSPI plunge.
• Adoption of AI Ad Agents: Track early adoption rates and performance metrics for the new AI advertising agents launched by Naver, Kakao, and other platforms.
• Deep Tech Funding Rounds: Keep an eye on further large-scale funding rounds for AI chip startups, which are currently driving the recovery in venture capital activity.