South Korea Joins Chip Selloff & Oil Drops – Asia Market Wrap
Technology stocks came under renewed pressure in Asia as a selloff in semiconductor shares spread to South Korea, fuelling concerns that this year’s AI-driven rally has become overstretched. MSCI’s Asia Pacific index fell 0.8%, while South Korea’s Kospi plunged nearly 7% before trimming losses.
AI-related chipmakers led the decline, with Samsung Electronics and SK Hynix each falling more than 6%. In Japan, Kioxia tumbled 13% after soaring more than 650% earlier this year, highlighting the volatility surrounding AI-linked names.
Risk sentiment stabilised later in the session, with US equity futures reversing earlier declines. Nasdaq 100 futures rose 0.3%, while European stocks were set for modest gains ahead of Thursday’s US payrolls report.
The latest weakness follows sharp swings across global technology stocks in late June, underscoring growing investor unease over lofty AI valuations despite continued enthusiasm for the sector. Brent crude also fell to its lowest level since before the start of the Middle East conflict.
