South Korean stocks tumble over 4% amid AI profitability concerns
KOSPI drops 4.58 percent, triggering a sell-side sidecar following tech losses on Wall Street.
Quick Look
South Korean stocks plunged over 4 percent on Thursday, driven by heavy tech losses amid ongoing doubts regarding the profitability of AI investments, prompting a temporary trading halt.
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Why It Matters
The KOSPI fell 4.58 percent to close at 6,296.38 following overnight tech sell-offs on Wall Street over AI infrastructure spending doubts.
SEOUL, Aug. 6 (Yonhap) -- South Korean stocks tumbled more than 4 percent Thursday due to losses in tech shares amid lingering concerns over profitability of artificial intelligence (AI) spending. The local currency rose against the U.S. dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) fell 4.58 percent, or 301.88 points, to close at 6,296.38, after falling as low as 6,238.32.
The index had risen 1.62 percent and 3.76 percent on Tuesday and Wednesday, respectively, driven by eased concerns over AI profitability.
After opening 1.81 percent lower, the KOSPI extended its losses, prompting the bourse operator to activate a sell-side sidecar for the KOSPI for five minutes at 10:18 a.m., halting program trading for KOSPI-listed shares.
Overnight on Wall Street, investors sold off Nasdaq-listed tech heavyweights, like Alphabet and Advanced Micro Devices, pushing down the tech-savvy index by 0.83 percent on doubt about profitability of large-scale investment in AI infrastructure.
However, signs of eased tensions in the Middle East pushed up the Dow Jones Industrial Average to rise 0.49 percent to a new record high.
Open Questions
- Will AI profitability concerns continue to pressure global tech stocks?
