HONG KONG (AP) — South Korea’s benchmark Kospi index dropped more than 5% on Tuesday on a sell-off of chip shares and Asian shares mostly declined after U.S. stocks ended mixed.
U.S. futures were also mixed and oil prices fell as escalating tensions in the Middle East continued.
The Kospi index was down 5.5% to 6,035.35, recovering some of its losses after it fell more than 7% intraday to below the 6,000 mark. It reached an all-time high in June after crossing 9,000, supercharged by the global artificial intelligence boom.
Samsung Electronics fell 7.4%, while memory chipmaker SK Hynix plunged 10.1%.
Investors’ unease over the AI boom has clouded prospects. Both companies’ stocks fell following reports that the latest advances made by China’s memory chipmaker CXMT could increasingly challenge Samsung Electronics, SK Hynix and Micron Technology, the world’s biggest memory chipmakers.
Japan’s Nikkei 225 dropped 1.8% to 67,777.52. Chip equipment maker Tokyo Electron fell 7.2%. SoftBank Group, an OpenAI investor, lost 8.5%.
Hong Kong’s Hang Seng added 0.2% to 24,315.25. The Shanghai Composite index was up 0.1% to 3,800.86.
Australia’s S&P/ASX 200 was mostly unchanged at 8,783.90.
Taiwan’s Taiex fell 2%, with its leading chipmaker TSMC, or Taiwan Semiconductor Manufacturing Co., also down 2%.
India's Sensex advanced 0.8%.
On Monday, Wall Street’s benchmark S&P 500 edged down 0.1%. The Dow Jones Industrial Average added 0.4% and the technology-heavy Nasdaq composite declined 0.4%.
Chip-related shares traded lower. Nvidia was down 1.3%. Advanced Micro Devices, or AMD, was 2.3% lower. Micron Technology lost 3.9%. Broadcom fell 1.9%.
Investors also are watching this week’s earnings announcements by major firms including big banks, with Citigroup, JPMorgan Chase and Wells Fargo reporting results.
Oil prices dropped more than 1%. Brent crude, the international standard, fell 1.3% to $105.25 a barrel. That is still higher than the roughly $72 per barrel in late February before the Iran war.
Benchmark U.S. crude was down 1.5% to $92.33 a barrel.
“The market is more concerned over recent developments in the Middle East, with Houthi attacks on Saudi Arabia and the lingering risks to oil flows from the Persian Gulf,” wrote ING commodities strategists Warren Patterson and Ewa Manthey in a commentary Tuesday.
The U.S. dollar fell to 158.18 Japanese yen from 158.61 yen. The euro was trading at $1.1193, up from $1.1155.
