A hot sector watchlist, data center, market center, capital flow, and simulated trading client report on August 7 that Hong Kong-listed CSOP SK Hynix Daily Leverage (2x) Product (7709.HK) opened over 7% lower at HKD 29.22, continuing to decline in early trading with a drop of more than 10%. This marks a decline of over 85% from its peak of HKD 193.65 on June 25.

On the news front, South Korea's KOSPI index fell 2%, with SK hynix shares dropping nearly 5%. Overnight, the memory chip sector on the U.S. stock market also suffered a collective slump, with Western Digital plummeting over 13%, SanDisk falling nearly 7%, and SK hynix ADRs declining about 5%.

Additionally, CSOP's leveraged product has switched to a flexible leverage structure since August 3, where the leverage can be reduced to as low as 1.1 times under extreme market conditions. The Hong Kong Securities and Futures Commission has previously warned that leveraged and inverse products are designed for single-day trading and are not suitable for holding for more than one day.