S. Korea briefly halted Kospi program trading after futures drop

S. Korea briefly halted Kospi program trading after futures drop

South Korea Briefly Halts Kospi Trading After Sharp Market Decline

South Korea’s Korea Exchange (KRX) temporarily suspended trading on the Kospi benchmark index on February 5, 2026, following a steep intraday drop triggered by global market volatility and domestic sector weakness. The regulator activated a circuit-breaker mechanism after the Kospi 200 Futures index fell more than 5%, prompting a five-minute trading halt at 9:06 a.m. local time. By the close, the Kospi had fallen 4.0% to 4,956.81, marking its largest single-day decline since November 21.

The sell-off was driven by a combination of factors, including uncertainty over U.S. Federal Reserve policy following President Donald Trump’s nomination of Kevin Warsh as Fed chair and concerns about the sustainability of AI-related investment. Large-cap semiconductor stocks, including Samsung Electronics (-3.8%) and SK Hynix (-4.5%), led losses, while automakers Hyundai Motor (-5.9%) and Kia (-3.3%) also underperformed.

Global market jitters amplified the decline. Wall Street’s retreat and a sharp drop in gold and silver prices—silver fell 30% on January 31, its worst one-day performance since 1980— spurred risk-off sentiment. Bitcoin also dipped below $80,000, reflecting broader investor caution.

The KRX’s intervention aimed to stabilize the market amid heightened volatility. “Jensen Huang’s comments about OpenAI’s proposed investment likely acted as a profit-taking catalyst, particularly for AI-exposed names,” said Gary Tan, a portfolio manager at Allspring Global Investments, highlighting the fragility of momentum-driven sectors.

The Kospi’s decline mirrored broader Asian market weakness, with the MSCI Asia Pacific Index down 1.7% on the day. Investors remain focused on China’s January factory activity data and evolving U.S. monetary policy, which could further shape regional market dynamics.

Source 1: Korea Exchange trading halt details.
Source 2: CNBC’s analysis of gold, silver, and cryptocurrency trends.
Source 3: Bloomberg’s assessment of Kospi’s decline and contributing factors.