South Korea’s Kospi index sinks more than 7% on semiconductor share sell-off over AI boom worries: news

South Korea’s Kospi Index Plunges Over 7% Amid Semiconductor Sell-Off and AI Boom Worries

South Korea’s benchmark Kospi index plummeted more than 7%, driven by a sharp sell-off in heavyweight semiconductor shares as global market sentiment cooled over the sustainability of the artificial intelligence boom.

Key Drivers Behind the Kospi Market Decline

• Heavyweight Tech Slump: Leading chipmakers bore the brunt of the downturn, with industry leaders Samsung Electronics and SK Hynix experiencing steep losses due to valuation concerns and profit-taking across tech sectors.

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• AI Rally Skepticism: Investors are increasingly scrutinizing the rapid capital expenditure into generative AI infrastructure, questioning the near-term monetization timeline for artificial intelligence applications.

• Broader Regional Impact: The sell-off spilled into wider Asian markets, pressuring regional tech suppliers, chip equipment manufacturers, and growth-oriented equities.

• Foreign Outflows: Persistent institutional and foreign investor selling intensified downward momentum across Seoul’s main equity board.

The sudden pullback highlights the outsized vulnerability of the tech-heavy Kospi to shifts in global semiconductor demand, interest rate expectations, and market sentiment surrounding the high-flying AI trade.