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Kospi sinks over 1.5% on persisting AI valuation woes

Published: 18 Dec. 2025, 17:25

The closing benchmark of the Kospi is displayed on a screen inside the dealing room of Hana Bank in central Seoul, on Dec. 18. [YONHAP]

Korean stocks closed sharply lower Thursday on continued concerns over the profitability of the AI sector. The Korean won rose against the U.S. dollar.

The Kospi fell 61.9 points, or 1.53 percent, to 3,994.5.

Trade volume was moderate at 576 million shares worth 12.8 trillion won ($8.7 billion). Losers outnumbered winners 685 to 195.

Institutions were net sellers, off-loading 100.6 billion won. Retail investors purchased a net 423.2 billion won.

Foreign investors were net sellers for a fourth consecutive session, releasing a net 355.9 billion won.

"Issues surrounding Oracle's data center projects have fanned concerns over the profitability of AI, but the Kospi's decline was limited due to Micron's earnings surprise," Lee Kyoung-min, an analyst from Daishin Securities, said.

Overnight, Oracle slipped by more than 5 percent, after reports said its major funding partner decided to drop out from the company's data center construction project.

It remains uncertain whether Micron's earning surprise could calm fears of an AI bubble, but could strengthen confidence in the "semiconductor super cycle," which will likely provide momentum to the country's major chipmakers, Lee added.

The local currency was quoted at 1,478.3 won against the greenback as of 3:30 p.m., down 0.1 percent from the previous session's close of 1,479.8 won.

Bond prices, which move inversely to yields, ended higher. The yield on three-year Treasurys fell 2.9 basis points at 2.967 percent, and the return on the benchmark five-year government bonds shed 3.1 basis points to 3.196 percent.

Yonhap