(LEAD) Stocks close lower as investors search for directions amid AI sector uncertainties

Seoul stocks fell on Monday as investors grappled with uncertainties surrounding the artificial intelligence (AI) sector, particularly in light of an internal probe at Nvidia Corp. following allegations of its CEO being targeted by a Chinese spy. The Korea Composite Stock Price Index (KOSPI) closed 0.81 percent lower at 5,018.85, with a trading volume of 231.8 million shares valued at 17.26 trillion won.

Investors were net sellers, offloading a combined 1.18 trillion won, while institutional investors purchased a net 717.1 billion won. Analyst Lee Kyoung-min noted that investors were searching for direction as bargain hunting continued in semiconductors. Despite concerns over the future of AI data centers due to the Democrats' victory in the US midterms, semiconductor prices recovered somewhat.

Nvidia announced an internal probe into CEO Jensen Huang's alleged affair with a suspected Chinese spy, which caused fresh jitters. Despite Huang admitting to infidelity, Nvidia's shares rose. Large-cap shares predominantly closed lower, with Samsung Electronics, SK hynix, LG Energy Solution, Hyundai Motor, and Hanwha Aerospace among the decliners. The Korean won strengthened against the US dollar, closing at 1,347.1 won.