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South Korean stocks led declines across Asia on Thursday as a fresh selloff in global artificial intelligence (AI)-related shares hit semiconductor manufacturers. Concerns over AI infrastructure spending outweighed strong regional economic data.
The KOSPI was last down 5%, with major chipmakers Samsung Electronics Co. Ltd. (KS:005930) and SK Hynix Inc. (KS:000660) falling 7.5% and 9.2%, respectively, extending losses after a weak overnight session on Wall Street.
The decline followed reports that Meta Platforms Inc. (NASDAQ) is exploring a cloud infrastructure business to sell AI computing capacity, fueling concerns that large-scale AI spending could become more restrained. A separate report that Apple Inc. (NASDAQ) is evaluating memory chips from Chinese suppliers also weighed on sentiment toward South Korea’s dominant memory chipmakers.
The weakness spread after U.S. memory chipmaker Micron Technology Inc. (NASDAQ) and data storage company SanDisk Corporation (NASDAQ) both fell more than 10% overnight.
Nasdaq 100 Futures and S&P 500 Futures were little changed as investors looked past the initial selloff ahead of the latest U.S. economic data.
AI Selloff Ripples Across Asia’s Semiconductor Supply Chain
South Korea’s major technology companies bore the brunt of the regional selloff, with SK Hynix falling to its lowest level since June 17 and Samsung Electronics dropping to its weakest level since June 8, reflecting growing investor caution over whether the AI-driven chip rally can maintain its rapid momentum.
Pressure spread across the broader semiconductor supply chain. Japan’s Nikkei 225 fell 1.6%, although the broader TOPIX edged up 0.5%.
Among chip-related stocks, Kioxia Holdings Corp. (TYO:285A) plunged 13.3%, Ibiden Co. Ltd. (TYO:4062) dropped 7.9%, Murata Manufacturing Co. (TYO:6981) and Furukawa Electric Co., Ltd. (TYO:5801) each declined 7.2%, while Mitsui Mining and Smelting Co. (TYO:5706) fell 9.6%, highlighting broad-based selling across AI suppliers.
Taiwanese chipmakers also came under pressure, with TSMC extending recent losses alongside other companies in the AI supply chain as investors reassessed the sector’s elevated valuations following this year’s strong rally.
Outside the technology sector, SoftBank Group Corp. (TYO:9984) gained 1.5% after Reuters reported that the company had revived talks for a $10 billion loan backed by its stake in OpenAI to support its AI investment plans. Meanwhile, Kakaku.com Inc. (TYO:2371) advanced after reports that Bain Capital and LY Corp had improved their takeover proposal for the online price-comparison operator.
Elsewhere, mainland Chinese markets proved relatively resilient. The Shanghai Composite fell 1.9%, while the CSI 300 declined 0.9%, giving up earlier gains despite stronger manufacturing survey data and expectations of additional policy support.
Regional Economic Data Overshadowed by Technology Concerns
Regional economic releases received little attention as investors remained focused on the outlook for AI spending.
Australia’s ASX 200 edged lower after the country posted an unexpected trade deficit in May, raising concerns about weakening overseas demand for commodities following strong performance earlier this year.
Indonesia’s Jakarta Stock Exchange Composite Index rose 1.8%, while Nifty 50 Futures gained 0.4%.
Earlier factory surveys from China, Japan, and most of Southeast Asia painted a broadly resilient picture of manufacturing activity.
South Korea’s latest inflation data also met expectations, indicating that price pressures remained broadly stable, while export growth continued to highlight the resilience of the country’s external sector. Nevertheless, Thursday’s sharp decline was driven more by shifting global technology sentiment than by weakening domestic fundamentals.
Markets also remained cautious ahead of remarks from U.S. President Donald Trump on Thursday, with investors watching closely for any comments on trade and economic policy that could influence global risk sentiment.
