Kospi plunges 5% as tech stocks tumble

Seoul shares plunged by more than 5 percent Tuesday, extending their losing streak to a fifth session, as technology stocks tumbled amid renewed woes over the AI sector and inflation. The local currency weakened against the dollar.

After opening 3.1 percent lower, the benchmark Kospi fell 348.89 points, or 5.46 percent, to 6,035.35.

Foreigners sold a net 4.51 trillion won ($3.35 billion) worth of stocks, while institutions and individuals bought a net 1.69 trillion won and 2.23 trillion won, respectively.

The Korea Exchange, Korea's bourse operator, triggered a sell-side sidecar during morning trading after the Kospi fell more than 5 percent for at least one minute.

Trade volume was moderate at 399.87 million shares worth 26.79 trillion won, with decliners outnumbering advancers 628 to 246.

“Concerns over OpenAI's revenue and the completion of local chipmakers' share buybacks continued to weigh on tech stocks,” Han Ji-young, an analyst at Kiwoom Securities, said.

Overnight, U.S. stocks closed mixed, with the Dow Jones Industrial Average rising 0.38 percent and the tech-heavy Nasdaq composite falling 0.44 percent.

Chipmakers faced a deep slump after reports of rapid tech progress by Chinese rival CXMT.

Investors now await the U.S. consumer price index report due Wednesday for clues on the Federal Reserve's policy outlook ahead of its October rate-setting meeting.

In Seoul, tech stocks led the decline.

Samsung Electronics fell 7.39 percent to 232,000 won, and its chipmaking rival SK hynix plunged 10.09 percent to 1.44 million won.

Hanwha Aerospace dropped 2.67 percent to 839,000 won, and carmaker Hyundai Motor shed 1.56 percent to 315,000 won.

Among gainers, shipping firm HMM rose 1.15 percent to 22,050 won, and state-run utility Korea Electric Power climbed 2.1 percent to 29,150 won.

The won weakened 10 won from the previous session to trade at 1,345.1  against the greenback at 3:30 p.m.

Yonhap