Wall Street rose after the US midterms. The Kospi fell 5.28% as foreigners sold $2.55 billion.

South Korea's Kospi fell 5.28% to 5,383.80 on November 5, its lowest close since April 3. Investors in Seoul focused on the risk of tighter rules for AI data centers, even as US stocks had rallied overnight after Democrats won both chambers of Congress, Yonhap News Agency (연합뉴스) reported.

Foreign investors sold a net 3.42 trillion won ($2.55 billion) of Kospi shares, their fifth straight day of net selling. Individuals bought a net 2.27 trillion won ($1.69 billion), while institutions bought 845.6 billion won ($630 million).

The index's two largest stocks fell sharply: Samsung Electronics (005930) lost 7.57%, and SK Hynix (000660) dropped 9.46%. The Kospi ended the day 42.6% below its June 19 intraday high of 9,385.59, by our calculations. We covered the US market reaction separately.

Samsung and SK Hynix led the fall

Samsung closed at 201,500 won ($150), after briefly falling below 200,000 won for the first time since July 29. SK Hynix closed at 1,264,000 won ($942), leaving its market value at 923 trillion won ($688 billion), its first close below 1,000 trillion won since October 27. Samsung Electro-Mechanics (009150) fell 15.34% to 944,000 won ($703).

The Kospi fell as low as 5,336.88 during the session. A sell-side sidecar stopped program selling for five minutes at 10:16 a.m. The measure is triggered when Kospi 200 futures fall 5% or more for at least one minute. It was the 29th Kospi sidecar this year.

The Kosdaq also triggered a sidecar at about 2:27 p.m., its 16th this year. It was the first time both markets had triggered one on the same day since October 15. The Kosdaq closed down 5.11% at 678.41, its first close below 700 since July 30.

Power equipment makers fell with the chipmakers

Korea's power equipment makers also sell into the US data center market. LS Electric (010120) fell 13.87% to 129,800 won ($97). Hyosung Heavy Industries (298040) fell 12.59% to 1,791,000 won ($1,334), and HD Hyundai Electric (267260) fell 8.44% to 401,500 won ($299).

The US made up 57% of Hyosung Heavy's 17.5 trillion won ($13.0 billion) order backlog at the end of June, and 68% of its new orders in the third quarter came from there, InvestChosun (인베스트조선) reported. HD Hyundai Electric signed a long-term supply agreement in July, worth up to 1.12 trillion won ($835 million), to deliver power equipment to North American data centers through 2028. We looked at Hyosung's US push in September.

Lee Kyung-min, an analyst at Daishin Securities, said semiconductors, power equipment, and substrates all fell sharply and led the index lower.

Automakers, Naver, and Kakao moved the other way

Not every large stock fell. Hyundai Motor rose 3.53% to 293,500 won ($219), and Kia rose 5.22% to 100,800 won ($75). Yonhap said the gains appeared to reflect hopes that the Trump administration's tariff policy would lose force after the election.

Kakao rose 10.65% to 32,200 won ($24) after announcing a 150 billion won ($112 million) share buyback and cancellation. Naver rose 8.26% to 184,900 won ($138). Lee said money moved into drugmakers, cosmetics, and autos, but not enough to offset the weight of the semiconductor stocks.

Korean analysts are watching Kospi 5,200

"If the index breaks below 5,200 while AI uncertainty and foreign selling continue, selling pressure could grow and the swings could get worse," Lee said. "If that support holds, we can expect bargain buying and a technical rebound."

Others think the fear has gone too far. Park Hye-ran, an analyst at Samsung Securities, said the Democrats want AI use managed transparently and aren't trying to limit how fast the technology develops, News1 (뉴스1) reported. "With data centers, too, the point isn't blanket delays or opposition. It's redistributing costs and improving conditions for local communities," she said.

The won barely moved. It closed at 1,342.1 per dollar at 3:30 p.m., 0.6 won weaker than the previous session.

Dollar figures use that rate. Quotes are translated from Korean.