The stock market fell as investors locked in profits from earlier gains, with the defense sector leading the declines. The Kospi Index dropped 0.55% to close at 3,210.01 after strong performance earlier in the week. This came as uncertainty over potential US import tariff changes and easing geopolitical tensions weighed on sentiment. Traders shifted positions to reduce risk exposure and protect recent gains.
Despite the day’s loss, the stock market still recorded a weekly gain of about 2.9%. Foreign buying earlier in the week had pushed the index higher, providing a positive base for trading. However, profit-taking in major sectors overshadowed the rally. Many investors adopted a cautious approach, closely monitoring both domestic developments and global trade signals.
Defence stocks posted the steepest losses, with Hanwha Aerospace down 5.5%, Hyundai Rotem off 4.9%, and LIG Nex1 plunging 14.9%. These moves reflected market expectations that easing geopolitical tensions could reduce demand for defense-related products and contracts. The sector’s sharp retreat played a major role in the Kospi’s decline. Such a pullback signaled a shift away from the strong momentum defence stocks enjoyed earlier this year.
Losses also extended to other industries, putting further pressure on the stock market. Technology heavyweight SK Hynix dropped 2.1%, reflecting reduced appetite for chip stocks. Shipbuilder HD Hyundai Heavy Industries slipped 1.8%, adding to the day’s overall decline. The weakness across multiple sectors underscored the broad caution in investor sentiment.
On a brighter note, Samsung Electronics gained 1.8% after reports confirmed it will manufacture Apple’s next-generation processor at its Texas foundry. The news lifted confidence in Samsung’s chip production capabilities and long-term growth potential. Consumer goods maker KT&G also surged 6.3%, leading market gainers and helping to offset some of the losses from industrial and technology names. These gains showed selective strength in certain areas despite the overall market pullback.
Trading volume totaled about 334 million shares valued at 11.2 trillion won. Institutional and foreign investors were net sellers, securing earlier profits amid market uncertainty. Retail investors, however, stepped in as net buyers, taking advantage of price declines in several key stocks. This shift in participation provided some stability during the session.
Looking ahead, analysts expect the stock market to react strongly to updates on global trade policy and corporate earnings. While defense and technology sectors may face continued pressure, opportunities remain in consumer and semiconductor-related stocks. Balancing profit-taking with new investments will likely shape short-term momentum. Market watchers believe volatility could persist as investors adjust strategies in response to economic signals.
