South Korean stock market hit by 'double circuit breakers,' fallout from US midterm elections continues to batter global markets.

BlockBeats news, November 5 — South Korean stocks plunged sharply on November 5 amid concerns over tighter AI data center regulation triggered by the U.S. midterm election results, with both the KOSPI and KOSDAQ indices triggering market stabilization mechanisms on the same day, and semiconductor and AI infrastructure-related stocks suffering heavy losses.

As of 14:25 Beijing time, the KOSPI fell 5.5% to 5,371.41 points, while the KOSDAQ dropped 5.11% to 678.4 points. Samsung Electronics fell as much as 7.8%, SK Hynix declined 9.81%, and power equipment companies Hyosung Heavy Industries, HD Hyundai Electric, and Samil Electric respectively dropped 10.1%, 7.53%, and 12.84%.

The market fears that after a major victory by Democrats in the U.S. midterm elections, they may push for stricter regulation of data center approvals, grid interconnection, and electricity costs, leading to delays in some AI data center projects, which would in turn affect hyperscale cloud service providers' capital expenditure plans and dampen demand expectations for memory chips such as HBM and DRAM.

Some analysts noted that delays in data center construction could postpone the realization timeline of cloud revenue for major tech companies and increase financing pressure on highly leveraged AI infrastructure firms. However, others believe that even if Democrats control Congress, it would be difficult to easily change the overall direction of U.S. AI investment, and the actual impact may be limited.