Seoul stocks open sharply lower on lingering concerns over AI, US inflation

Seoul stocks plunged to their lowest level in months on Thursday, as investor confidence dwindled due to lingering doubts about the viability of artificial intelligence (AI) and unexpectedly high inflation rates in the United States. The Korea Composite Stock Price Index (KOSPI), which serves as the benchmark for Seoul stocks, plummeted 348.47 points, or 5.8 percent, bringing the index to 5,660.34 by 9:15 a.m. In response to the sharp decline, the country's bourse operator promptly issued a sell-side sidecar to manage the market fallout. This downward spiral marked Seoul stocks' sixth consecutive day of losses.

Wall Street's major stock indexes also suffered their own setbacks overnight, with investors grappling with rising inflation worries and skepticism surrounding the potential for AI to deliver on its promised returns. The S&P 500 fell by 1.11 percent, while the tech-heavy Nasdaq experienced a 1.88 percent drop. The U.S. Consumer Price Index, a key inflation indicator, increased by 0.6 percent in September compared to the previous month, pushing the annual inflation rate to 3.7 percent.

This figure surpassed economists' expectations of a 3.6 percent rise, further fueling concerns about the broader economic impact. Despite these headwinds, many investors remain doubtful about whether AI investment can generate the anticipated returns that have fueled optimism in recent years.