(LEAD) Seoul shares dip over 5 pct on tech sell-off on renewed AI, inflation woes

Seoul shares dropped over 5 percent on Tuesday due to a sell-off in the technology sector, driven by worries over the AI industry and inflation concerns. The Korean won weakened against the US dollar. The Korea Composite Stock Price Index (KOSPI) fell by 348.89 points, or 5.46 percent, to 6,035.35. Foreign investors sold stocks worth 4.51 trillion won, while domestic buyers purchased stocks worth 1.69 trillion won and 2.23 trillion won, respectively.

The Korea Exchange triggered a sell-side sidecar during early trading after the KOSPI fell by more than 5 percent for at least one minute. Trade volume was moderate, with 399.87 million shares traded worth 26.79 trillion won, and more stocks declined than gained.

Analyst Han Ji-young at Kiwoom Securities attributed the tech stocks' decline to worries over OpenAI's revenue and the completion of local chipmakers' share buybacks. U.S. stocks closed mixed, with the Dow Jones Industrial Average up 0.38 percent and the tech-heavy Nasdaq composite down 0.44 percent. Chipmakers faced a significant drop following reports of rapid advancements by Chinese rival ChangXin Memory Technologies (CXMT).

Major companies like Samsung Electronics, SK hynix, Hanwha Aerospace, and Hyundai Motor experienced substantial losses, while shipping firm HMM and state-run utility Korea Electric Power Corp. managed gains. The Korean won traded at 1,345.1 won against the US dollar at 3:30 p.m., up from 1,335.1 won from the previous trading session's close.