Stocks that soared recently in South Korea on researchers’ claim of a breakthrough in superconductor technology tanked Friday as experts sought proof while the local exchange escalated its warning on the trading frenzy.
(Bloomberg) — Stocks that soared recently in South Korea on researchers’ claim of a breakthrough in superconductor technology tanked Friday as experts sought proof while the local exchange escalated its warning on the trading frenzy.
Mobiis Co. tumbled by a daily record of 30% while Duksung Co. slid 17% as Korea Exchange escalated its warning level on the “abnormal surge” in the two stocks. The bourse suspended trading in Sunam Co. for one day after it surged nearly 280% over the previous eight sessions.
The gains were driven by reports last month from Korean researchers saying they created the world’s first superconductor able to conduct electricity at room temperature and ambient pressure, utilizing a material called LK-99. While such technology could revolutionize industries from computing to power, the scientific community raised questions immediately.
The Korean Society of Superconductivity and Cryogenics said Wednesday that it has convened a panel to verify the findings and asked the Quantum Energy Research Centre, which contributed to the initial research, to submit samples. The “unverified claims” are “causing a great controversy,” the academic group said.
Korea Exchange, meanwhile, said investors should be warned before investing in Duksung and Mobiis, the second-highest level of its alert system before a potential trading suspension. The bourse hands down such designations when it sees a probability of speculative bets and unfair trades.
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Among other moves, Shinsung Delta Tech Co. plunged by a record 27% in Seoul on Friday. In US trading, American Superconductor Corp. has dropped 40% in the past two sessions following a five-day, 129% climb.
–With assistance from Sangmi Cha.
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