The Easy Knowledge Blog

As worries over Alphabet’s AI spending rattled Wall Street, the KOSPI slid more than 3% in a single day.

🎧 Post Summary

The previous close was 5,937.66. Today’s open was 177.31 points lower, at 5,760.35, and the losses widened from there. Let’s go through the numbers first, then why the market fell, who sold and who bought, and how sectors differed.

1. Today’s Market at a Glance

Item	Closing result
KOSPI	5,730.74 (-206.92 pts, -3.48%)
KOSDAQ	724.38 (-28.85 pts, -3.83%)
USD/KRW	1,334.3 won
KOSPI turnover	About 19.27 trillion won (provisional)
KOSPI advancers / decliners	107 up, 248 down, 4 unchanged

Decliners outnumbered advancers by more than two to one. In other words, selling pressure spread across the market instead of hitting only a few large caps.

2. Why It Fell: The Alphabet Shock and AI Profitability Worries

The most direct trigger cited for the plunge was the Alphabet shock. Alphabet reported third-quarter results after the U.S. close on October 28. Revenue was $127.577 billion, up 25% from a year earlier but short of the $128.22 billion market forecast. Capital expenditure surged 114% year on year to about $51.3 billion, and free cash flow was a deficit of roughly $9.07 billion. Reports said the shares fell around 10% in after-hours trading right after the release.

There is a counterpoint. CEO Sundar Pichai stressed that Google Cloud revenue grew 103% on AI demand. So growth itself is strong, but the market appears to be asking more strictly whether that growth pays for the enormous spending. Asia Economy later ran headlines describing a revival of AI investment skepticism and Alphabet’s biggest drop since its listing.

In Korea, too, reports said the KOSPI tumbled into the 4% range on the “Alphabet shock” and a sell sidecar was triggered, the first in 11 trading days. A sidecar is a safety mechanism that halts program sell orders for five minutes when futures prices move sharply.

3. Who Sold: Foreigners Sold Cash Stocks but Bought Futures

Net flows on the main KOSPI board by investor type were as follows.

• Foreign investors: net sold 1.6169 trillion won
• Institutions: net bought 743.6 billion won
• Individuals: net bought 619.5 billion won

The futures market is worth a closer look. Foreigners net bought 1.147 trillion won of futures while institutions net sold 1.1192 trillion won. Since the same foreign investors sold cash stocks and bought futures, it is hard to read the day as a simple “exodus from Korea.” Program trading showed net buying of 266.2 billion won in arbitrage and 194.5 billion won in non-arbitrage.

4. Sectors and Stocks: Chips Slid, Pharma and Biotech Rose

Most sectors fell. Medical precision instruments dropped 7.13%, followed by construction (-6.22%), transportation equipment (-4.88%), electrical and electronics (-4.67%), manufacturing and machinery (each -4.01%), and securities (-3.5%). On the other side, pharmaceuticals gained 4.9%, with transport and storage (+1.33%), food, beverage and tobacco (+1.08%), textiles and apparel (+1.04%), and electricity and gas (+0.74%) also higher.

Stock	Change
Samsung Electronics	-3.66%
SK hynix	-6.88%
SK Square	-6.3%
Samsung Electro-Mechanics	-7.97%
Hyundai Motor	-4.44%
Samsung C&T	-4.17%
Samsung Biologics	+5.78%
LG Energy Solution	+0.56%

The brunt of the AI-spending worries fell on semiconductors, while Samsung Biologics stood out among the top market-cap names with a 5.78% gain.

5. The KOSDAQ Fell Even Harder

The KOSDAQ fell 3.83% to 724.38, a bigger drop than the KOSPI. Individuals net bought 168.9 billion won, but institutions (-137.8 billion won) and foreigners (-27.4 billion won) were net sellers. Among top-cap names, chip-related stocks such as Leeno Industrial (-8.91%), Wonik IPS (-7.92%), Simmtech (-7.54%), EO Technics (-6.27%), and Jusung Engineering (-6.5%) fell sharply, while HLB rose 0.5%.

Things Investors Should Keep in Mind

• A daily drop in the 3% range signals higher volatility more than a settled direction. The KOSPI has swung between sharp drops and rebounds this month.
• Alphabet’s AI spending burden could be a company-specific issue or an industry-wide one. Cloud revenue more than doubled, which is worth weighing too.
• Flows were mixed, with foreigners selling cash stocks while buying futures. It is hard to draw a conclusion from any single indicator.
• This post is for informational purposes only and is not investment advice. Investment decisions and responsibility rest with you.

In short, today’s KOSPI was a day when the debate over AI investment returns, ignited by Alphabet’s earnings, flowed into foreign selling of cash stocks and weakness in semiconductor heavyweights. With the U.S. midterm elections set for November 3 next week, it remains to be seen whether this overseas-driven volatility persists for a while.

Related Posts (Korean)

• KOSPI falls 1.46% to 5,469, lowest in seven months (Oct 26 market wrap)
• KOSPI plunges 3.73% to 5,552, with experts split between oversold and too early

References

• Asia Economy – KOSPI falls on 1.6 trillion won foreign net selling, closes in the 5,730s (asiae.co.kr)
• Newspim – KOSPI closes down 3.48% (newspim.com)
• Nate News (News1) – [Today’s Market] October 30 KOSPI, KOSDAQ (news.nate.com)
• Nate News (MBN) – [Breaking] KOSPI closes at 5,730.74, won at 1,334.3 per dollar (news.nate.com)
• Ajunews – Alphabet shares plunge 10% despite 103% cloud revenue surge (ajunews.com)
• supple.kr – Alphabet’s free cash flow deficit widens on revenue miss, shares drop as much as 10% after hours (supple.kr)
• Asia Economy – AI investment skepticism revives as Alphabet posts biggest drop since listing (asiae.co.kr)