Seoul shares down over 2 pct late Tues. morning on AI concerns

South Korean stocks suffered a sharp decline of over 2 percent in late Tuesday morning trading, with the tech sector specifically feeling the brunt of lingering doubts about the rapid pace of artificial intelligence (AI) spending. The Korea Composite Stock Price Index (KOSPI), which opened 2.46 percent lower, fell by 145.02 points, or 2.48 percent, to reach a level of 5,714.06 by 11:20 a.m. local time.

The downturn on Wall Street mirrored the fears, with the tech-focused Nasdaq Composite and the S&P 500 closing 1.07 percent and 0.51 percent lower, respectively, as investors awaited the U.S. midterm elections scheduled for the same day. This adverse market sentiment was fueled by apprehensions that excessive investment in AI infrastructure could be negatively impacting the near-term profitability of tech companies.

Key players in the tech industry took the biggest hits, with Samsung Electronics plummeting 2.95 percent, and chipmaker SK hynix suffering a 3.8 percent drop. Hanmi Semiconductor, a leading manufacturer of chip equipment, saw its share price drop by 4.17 percent, while SK Square, the parent company of SK hynix, fell by 4 percent. Additionally, POSCO Holdings, a prominent steel producer, saw its value plunge 5.3 percent, while SK Innovation, a major oil refinery, declined by 7.76 percent.

As the trading session concluded, the Korean won was trading at 1,341 won against the U.S. dollar, a gain of 3.4 won from the previous day's closing figure.