Foreign, Institutional Investors Dump $3 Billion; Chip Stocks Plunge 5%

* Editor's note: AI PRISM (Personalized Report & Insight Summarizing Media) is an artificial intelligence-based personalized news recommendation and summary service developed with support from the Korea Press Foundation. It selects and provides six news items tailored to each reader type.

1. KOSPI Gives Up 7,000 in Four Sessions as Selling Targets Chip Stocks

Key points: On the first trading day after the Chuseok holiday, the KOSPI plunged 191.18 points, or 2.70%, to close at 6,889.74, falling below the 7,000 level for the first time in four sessions. The drop reflected a cluster of negative factors from the holiday period — surging U.S. Treasury yields, firm international oil prices and the continuing Middle East conflict — priced into the market at once. Foreign investors sold a net 3.24 trillion won and institutions a net 1.02 trillion won. Samsung Electronics (270,000 won) and SK hynix (1.768 million won) ranked first and second in net selling by foreign and institutional investors, concentrating the selling on large-cap chip stocks. For SK hynix, reports that its second-tier subsidiary Solidigm is pursuing a U.S. initial public offering were cited as an additional negative. The KOSDAQ ended up 2.10 points, or 0.25%, in a divergence analysts attribute to the focus on large caps.

2. U.S. Treasury Yields Highest Since 2007; 3 Trillion Won in Foreign Selling Deepens Won Weakness

Key points: During the Chuseok holiday, U.S. five-, 10- and 30-year Treasury yields all hit their highest levels since 2007, sending the won-dollar rate up to 1,365.10 won. Inflation concerns tied to Middle East tensions and the Fed's hawkish stance, compounded by a weak Treasury buyback (4.08 billion dollars, or 68% of the 6 billion dollar limit), sharply dampened appetite for bonds. JPMorgan and Goldman Sachs warned of greater volatility from supply-demand strains, while Bank of America and Citadel pointed instead to structural upward pressure on rates from AI infrastructure investment, leaving views divided. In the currency market, observers say the pair could trade between 1,350 and 1,370 won for the time being, with month-end exporter dollar selling capping the upside while high rates and foreign equity selling support the downside.

3. Global Investors Tell Korean Market: Cut Top Dividend Tax Rate to 25%

Key points: Major global investment institutions including BlackRock, Capital Group and Morgan Stanley jointly called for reform of Korea's capital market tax rules on the opening day of Korea Premium Week 2026. Winnie Kwan, a portfolio manager at Capital Group, which has invested more than 70 billion dollars cumulatively in the Korean market since the 1990s, argued that lowering the top dividend income tax rate from 45% to 25% could lead to expanded dividends and higher valuation multiples, and that inheritance tax reform could drive even greater change. Frank Carroll, managing director at Oaktree Capital, said repeated short-selling bans undermine market confidence and urged policy consistency, while Vanguard suggested that an inflow of long-term investment capital through wider use of individual savings accounts should proceed in parallel. As global capital's demands for resolving the Korea discount take more concrete form, the pace of tax reform and policy consistency are emerging as key variables for foreign fund flows, observers say.

4. U.S. Solar Module Prices Jump 40%; Hanwha, OCI Earnings Get Tailwind

Key points: Even before the U.S. minimum import price (MIP) rule for solar products under Section 232 of the Trade Expansion Act takes effect on Dec. 4, the median module price in the U.S. market has surged 40.7% to 0.38 dollars per watt from 0.27 dollars. Rising demand tied to expanding power needs from AI data centers has also fueled the price gains, with U.S. solar installations in the second quarter reaching 11.4 gigawatts, up 45% from a year earlier. Hanwha Solutions, which produces directly at its Solar Hub in Georgia, falls outside the scope of the MIP, allowing it to maintain price competitiveness while securing room to raise selling prices. Financial information provider FnGuide projects its fourth-quarter operating profit at 282.3 billion won, up 157.7% from a year earlier. OCI Holdings is also negotiating with new customers at more than 21 dollars per kilogram of polysilicon, up from 4 to 6 dollars, and its fourth-quarter operating profit is expected to reach 121.7 billion won, a 345% jump. Analysts note, however, that because long-term agreements account for a large share of its sales, there may be a lag before price increases are reflected in contract prices.

5. Was Huawei Not Enough? China Weighs Allowing Nvidia Chip Purchases

Key points: China's Ministry of Industry and Information Technology is reportedly reviewing approval for domestic companies such as ByteDance and Alibaba to purchase Nvidia's RTX Pro 5500 AI chip for workstations. ByteDance is said to be considering orders of about 1 million units, and Nvidia reportedly plans to ship roughly 500,000 units per quarter to China starting in late December. The RTX Pro 5500 can be used for AI agents, video generation and advertising production when eight servers are configured in parallel, but its performance is limited compared with GPUs dedicated to AI data centers, and because it carries standard graphics memory (GDDR7), its direct link to HBM demand is seen as weak. With the Trump administration maintaining its semiconductor export controls on China, and actual sales approval still uncertain, analysts say the potential benefit to Korean memory makers from China may be limited.

6. Trump Also Worried About Weak Yen; Talk of Back-to-Back BOJ Hikes

Key points: Just a week after the Bank of Japan raised its policy rate to 1.25%, the probability of a consecutive hike in October is being put at 20% to 30%, reigniting concerns about a chain of rate increases across Asia. The yen has continued to weaken, trading around 157.43 to the dollar, after the U.S. Federal Reserve raised its benchmark rate to 4.00% this month and Fed Chair Kevin Warsh signaled further tightening. Pressure from the U.S. side is intensifying, with President Trump directly stating at a Japan-U.S. summit that a weak yen is negative for U.S. trade, and U.S. Treasury Secretary Scott Bessent conveying that a stronger yen is desirable. Experts say monitoring is needed, particularly for sectors sensitive to exchange rates, because a faster-than-expected pace of BOJ rate increases could alter capital flows across Asian financial markets.