2025.12.0902:39:07UTC+00South Korean Shares Drop Ahead of Fed Decision

On Tuesday, the KOSPI index experienced a decline of 0.6%, closing at approximately 4,130, as investors adopted a more cautious stance ahead of the forthcoming U.S. Federal Reserve rate announcement. This downturn follows a pullback on Wall Street and saw traders taking a defensive approach as they anticipate the Fed's meeting scheduled for December 10, during which another rate cut is anticipated. Additional pressure emerged from the semiconductor industry after the Korea Exchange issued its second "investment caution" notice concerning SK Hynix, due to the rapid rise in its stock, fueled by a surge in AI-driven memory demand. This advisory urged investors to exercise restraint, resulting in SK Hynix shares dropping by as much as 1.7% in early trading. Throughout the year, SK Hynix's stock has experienced an approximate 230% increase, raising alarms over a potential tech bubble and negatively affecting the overall tech sector sentiment. Declines were particularly evident among companies such as SK Hynix (-1.8%), Samsung Electronics (-0.7%), LG Energy Solution (-2.0%), Hyundai Motor (-3.8%), KB Financial Group (-2.1%), and Kia Corporation (-1.2%).