Kospi again falls over 1 percent after 2-day rout amid AI spending concerns
The sell-off came amid uncertainty over the Fed's future policy path and renewed concerns over whether heavy AI-related investment by major tech companies will justify their elevated valuations.
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An electronic display board shows the Kospi in the trading room of Hana Bank's headquarters in Jung District, central Seoul, on July 30.YONHAP
Seoul shares fell by more than 1 percent on Thursday as retail investors heavily sold tech stocks following deep declines over the previous two sessions amid concerns over AI spending and uncertainty about the Federal Reserve's interest rate outlook.
The won strengthened against the dollar.
After volatile trading, the benchmark Kospi lost 69.68 points, or 1.23 percent, to close at 5,593.56 after plunging to an intraday low of 5,547.41.
The index also rose as high as 5,976.82 at one point.
After opening 0.33 percent higher, the Kospi reversed course to end in negative territory.
The broad-based sell-off came amid uncertainty over the Fed's future policy path and renewed concerns over whether heavy AI-related investment by major technology companies will generate sufficient returns to justify their elevated valuations, analysts said.
The Fed on Wednesday left its benchmark interest rate unchanged at 3.5-3.75 percent, marking its fifth consecutive meeting without a rate change.
The U.S. central bank offered little guidance on the future path of interest rates, leaving investors uncertain about the timing of any policy easing.
Trade volume was moderate at 375.17 million shares worth 37.6 trillion won ($26.2 billion), with gainers outnumbering losers 606 to 277.
Institutions and foreigners off-loaded a net 66.3 billion won and 1.34 trillion won worth of stocks, respectively. Individuals sold a net 1.43 trillion won.
Tech stocks led the decline.
From left: Samsung Electronics' flag; SK hynix's headquarters in Icheon, GyeonggiYONHAP
Market bellwether Samsung Electronics fell 0.72 percent to 207,000 won, and SK hynix plunged 5.64 percent to 1.32 million won.
Top carmaker Hyundai Motor declined 0.71 percent to 351,000 won, and national flag carrier Korean Air sank 0.6 percent to 24,650 won.
Internet giant Naver slid 4.05 percent to 201,500 won, and energy firm Doosan Enerbility dipped 0.99 percent to 60,200 won.
Among gainers, HD Korea Shipbuilding & Offshore Engineering (HD KSOE) rose 10 percent to 368,500 won, and defense giant Hanwha Aerospace jumped 6.79 percent to 865,000 won.
HD KSOE said Thursday it has signed a memorandum of understanding with U.S.-based Fraser Industries to help revitalize the U.S. shipbuilding industry under Seoul's "Make American Shipbuilding Great Again" initiative.
The won strengthened 9.3 won from the previous session to trade at 1,437.4 won against the dollar as of 3:30 p.m.
