South Korean Stocks Extend Losses as Investors Dump Tech Shares

SEOUL, June 26 (Yonhap) -- South Korean stocks extended losses late Friday morning as investors dumped tech shares to take profit from the previous session's sharp rally amid lingering woes on artificial intelligence (AI) investment.

After opening 1.31 percent lower, the benchmark Korea Composite Stock Price Index (KOSPI) extended losses, losing 501.16 points, or 5.61 percent, to 8,429.14 as of 11:20 a.m.

Due to the sharp drop, the bourse operator activated a sell-side sidecar for the KOSPI around 11:13 a.m., halting program trading for five minutes.

A sell-side sidecar is triggered when the KOSPI 200 Futures index decreases 5 percent or more for at least one minute.

A selling spree by foreign and institutional investors weighed heavily on the market following a 5.42 percent spike the previous day.

Wall Street was choppy as tech heavyweights finished in negative territory amid lingering concerns over the future of large-scale investment AI infrastructure.

Latest data showed that U.S. consumer prices rose 4.1 percent in May, far higher than the Federal Reserve's 2 percent target, adding to projections that the central bank will change its monetary approach to tame the inflationary pressure.

In Seoul, semiconductor shares were among the biggest losers.

Tech giant Samsung Electronics sank 6.56 percent, and its chipmaking rival SK hynix slumped 7.16 percent.

Hanmi Semiconductor, a leading chip equipment manufacturer, dropped 4.4 percent, and SK Square, the parent of SK hynix, tumbled 9.58 percent.

Major shipbuilder Hanwha Ocean skidded 4.92 percent, and pharmaceutical giant Celltrion dipped 4.04 percent.

The Korean won was trading at 1,548.75 won against the U.S. dollar at 11:20 a.m., down 6.65 won from the previous session.