South Korea's KOSPI fell more than 4 percent in early trading on Thursday, sliding to the 8,200 level. The fallout from Broadcom-led weakness in U.S. semiconductor stocks spread to major domestic chip shares, and a sharp drop in KOSPI200 futures triggered a sell sidecar on the main board market.

As of 9:13 a.m., the KOSPI was down 422.87 points, or 4.89 percent, at 8,216.54 from the previous session. The index opened down 316.21 points, or 3.66 percent, at 8,323.20, then extended losses to the 8,200 level in early trade.

The Korea Exchange triggered a sell sidecar on the main board market at 9:08:25 a.m. Program sell orders on the main board market were suspended for 5 minutes. It was the first sell sidecar on the main board market in 18 days since last month’s 18th.

A sell sidecar is triggered when futures prices based on the KOSPI200 fall at least 5 percent from the reference price and that condition persists for more than 1 minute.

By investor group, individuals and institutions were net buyers of 534.9 billion won and 15.1 billion won, respectively. Foreigners were net sellers of 581.1 billion won. Foreign selling appeared to add to downward pressure on the index in early trading.

Most of the top market-cap stocks were lower. Samsung Electronics was down 6.26 percent at 329,500 won, and SK Hynix was down 8.14 percent at 2,111,000 won.

Elsewhere, SK Square was down 8.16 percent, Hyundai Motor down 4.21 percent, Samsung Electro-Mechanics down 3.61 percent, LG Energy Solution down 1.30 percent, Samsung Life down 4.68 percent and Samsung C&T down 13.27 percent.

HD Hyundai Heavy Industries, meanwhile, was up 2.61 percent, the only gainer.

The market weakness was seen as reflecting a combination of deteriorating sentiment toward semiconductor investment linked to Broadcom and pressure from the exchange rate. Weakness in U.S. chip stocks led to profit-taking in major domestic chip shares, and the won-dollar exchange rate rose into the 1,530 won range, increasing the burden on foreign flows.

Han Ji-young (한지영), an analyst at Kiwoom Securities, said, "After opening lower on factors such as weakness in U.S. semiconductor stocks and the burden from the won-dollar exchange rate breaking into the 1,530 won range, the domestic market is expected to show a flow of recovering intraday losses as sector rotation trading unfolds from semiconductors to non-semiconductor sectors."

The KOSDAQ was also down 35.54 points, or 3.39 percent, at 1,014.19 at the same time. With the KOSPI and KOSDAQ plunging together, pressure from recent index highs was being reflected all at once.

In the Seoul foreign exchange market, the won was quoted at 1,533.70 per dollar, up 0.30 won.