KOSPI Plunges 3.6% as Short Selling Hits 1.7 Trillion Won, Chip and Battery Stocks Bear the Brunt

Foreigners and institutions dump 2 trillion won on AI profitability fears; short-selling share jumps to 7.14%, well above October average

Korean stocks fell sharply across the board on November 3. Worries about whether AI investment will pay off weighed on U.S. tech shares overnight, and the selling spread to Seoul. Short-selling turnover rose by more than 420 billion won from the previous day. On the KOSPI, short selling made up 7.14% of trading value, about 1.6 times the October average of 4.37%. The heaviest short selling hit SK Hynix, Samsung Electronics and large secondary-battery stocks.

■ How Far Did the Market Fall Today?

According to the Korea Exchange (KRX), the KOSPI closed at 5,648.79, down 210.29 points (-3.59%). The KOSDAQ ended at 704.39, down 29.97 points (-4.08%). Both indexes turned lower after one day of gains.

The KOSPI opened lower after U.S. tech shares fell on AI profitability concerns. During the session, foreigners and institutions sold together, mostly in electrical and electronics stocks, and the decline widened to more than 3%. Large caps lost 3.8%, while mid caps fell 1.5% and small caps 1.4%. By sector, medical and precision instruments fell most (-7.6%), followed by machinery and equipment (-5.0%), electrical and electronics (-4.8%) and chemicals (-3.9%).

Foreigners and institutions also sold the KOSDAQ throughout the session. Machinery and equipment (-6.7%), non-metallic minerals (-5.7%) and electrical and electronics (-5.6%) were the weakest sectors.

■ Who Sold and Who Bought?

In the KOSPI cash market, foreigners were net sellers of 1.5295 trillion won and institutions of 510.8 billion won. Retail investors absorbed the selling with net purchases of 1.6602 trillion won. Electrical and electronics stocks made up 1.1542 trillion won, about three-quarters, of foreign net selling. Finance (-126.5 billion won) and machinery and equipment (-56.8 billion won) came next.

Institutions did not all move the same way. Pension funds were net buyers of 113.9 billion won, while financial investment firms (-344.6 billion won) and investment trusts (-155.1 billion won) were net sellers. In KOSPI200 futures, foreigners sold a net 68 billion won and financial investment firms bought a net 824.1 billion won. Non-arbitrage program trading showed net selling of 998.6 billion won. The average basis was -0.83 points, far below the theoretical +2.51 points. Futures trading below spot is a sign of weak sentiment.

On the KOSDAQ, foreigners (-76.2 billion won) and institutions (-234.5 billion won) were net sellers, and retail investors were net buyers of 319.7 billion won.

■ How Much Did Short Selling Increase?

According to the KRX Short Selling Daily Brief, short-selling turnover was 1.7077 trillion won at the close. That was about 6.61% of total trading value and roughly 420.4 billion won more than the previous session.

The amount itself was smaller than on October 29 (1.6296 trillion won). As a share of trading value, though, 7.14% was the highest of the past five sessions. Even on May 29, the day with the largest short-selling turnover of the past year (5.3274 trillion won), the share was 4.23%. Short sales made up an unusually large part of trading on a falling day.

Investors must report short positions within two trading days (T+2), so the latest balance figures are still being compiled. In October, the average daily short-interest balance was 16.9666 trillion won on the KOSPI (0.34% of market cap) and 6.6668 trillion won on the KOSDAQ (1.46%).

■ Who Drove the Short Selling?

Foreigners still made up most short selling, but the institutional share on the KOSPI rose noticeably.

The institutional share on the KOSPI jumped about 10 percentage points, from 22.88% to 32.43%. That is close to double the October 28 level of 18.16%. On the KOSDAQ, the foreign share rose again to 83.42%. Retail investors accounted for less than 1% in both markets.

■ Which Stocks Were Targeted?

SK Hynix had the most short-selling turnover on the KOSPI (202.3 billion won). Samsung Electronics (112.0 billion won), Samsung SDI (92.7 billion won), SK Square (70.7 billion won) and LG Energy Solution (63.9 billion won) followed. Chip and battery heavyweights filled the top of the list.

Battery stocks had especially high short-selling shares. Short sales made up 30.02% of LG Energy Solution’s trading value, 32.59% of EcoPro BM’s and 22.37% of EcoPro’s. Samsung SDI had a 14.07% short share and plunged 9.20%, the steepest drop among the top KOSPI names.

By short-selling share, the KOSPI leaders were Hankook & Company (48.92%), Hankook Tire & Technology (38.73%), Doosan Robotics (38.22%) and Daewoo E&C (36.77%). Daewoo E&C had 31.7 billion won in short-selling turnover, and its shares fell 8.64%. On the KOSDAQ, the leaders were Inno Advanced Materials (33.19%), EcoPro BM (32.59%), Yuil Robotics (30.06%) and Jeryong Electric (29.45%).

■ Which Stocks Carry the Largest Short Positions?

As of October 29, LG Energy Solution had the largest short-interest balance on the KOSPI (1.6148 trillion won, 1.94% of market cap). Samsung Electronics (1.3595 trillion won), Hanmi Semiconductor (1.3554 trillion won), Hyundai Motor (878.0 billion won) and POSCO Future M (621.1 billion won) came next. Hanmi Semiconductor (7.22%) and POSCO Future M (4.34%) had high balances relative to market cap.

On the KOSDAQ, the ranking was EcoPro (801.0 billion won, 8.05%), EcoPro BM (474.0 billion won, 5.27%), Jusung Engineering (378.7 billion won, 4.60%), Alteogen (291.2 billion won, 1.90%) and Rainbow Robotics (227.1 billion won, 3.10%). EcoPro, EcoPro BM and Jusung Engineering ranked high both in short-interest balance and in the day’s short-selling turnover, so they faced short-selling pressure from both directions.

One stock, SOOP on the KOSDAQ, was designated as overheated for short selling, based on November 2 screening. No KOSPI stocks were designated.

■ How Did the Won and Overseas Markets Move?

The won strengthened for the first time in two days, with the dollar falling 5.1 won to 1,340.9 won. That ran against the heavy foreign selling of stocks. Government bond yields fell, with the 3-year at 3.736% (-0.4bp) and the 10-year at 4.002% (-2.8bp). WTI crude rose 1.60% to $98 a barrel.

Overseas, the Nasdaq fell 1.1% and the Dow rose 0.4%. Tech weakness spread to Asian chip markets. Taiwan’s TAIEX tumbled 3.6%, and the Shanghai Composite slipped 0.8%. Japan was closed for Culture Day.

■ Frequently Asked Questions (FAQ)

Q. Is a 7.14% short-selling share high?
Yes. It is 2.77 percentage points above the KOSPI’s October daily average of 4.37%. It is also well above the 4.23% share on May 29, the day with the largest short-selling turnover of the past year. Short sales made up an unusually large part of trading on a falling day.

Q. Why does today’s short-interest balance show “0”?
Short positions are reported within two trading days (T+2), so the last two sessions are not yet reflected. A zero does not mean the positions have disappeared.

Q. What happens when a stock is designated as overheated for short selling?
Short selling in that stock is banned for the next trading day. This time, SOOP on the KOSDAQ was designated.

Q. How much short selling comes from retail investors?
As of November 3, retail investors made up 0.78% on the KOSPI and 0.39% on the KOSDAQ, less than 1% in both. Foreigners and institutions effectively drive short selling.

■ Investment Notice

This article is based on the KRX “Market Brief, Nov. 3, 2026” (as of 3:45 p.m.) and the “Short Selling Daily Brief.” It is not a recommendation to buy or sell any security. Short-selling data covers regular-session trading only, and balance data may change if reports are amended. A high short-selling share does not guarantee further price declines. Investors are responsible for their own decisions.