South Korea's KOSPI slumped 5.6% on Monday as investors resumed selling artificial intelligence-linked chipmakers, a day after the index surged a record 18%. Japan and Australia's energy stocks also fell as oil prices retreated, while Chinese and Hong Kong markets held up better on gains in AI names like Alibaba.
South Korea's KOSPI tumbled more than 5% on Monday as another wave of selling in artificial intelligence-linked technology shares overshadowed easing Middle East tensions, falling oil prices and firmer U.S. equity futures. Nasdaq 100 Futures rose about 0.9% in Asian trade. S&P 500 Futures gained 0.6%, with both lifted by last week's earnings from Microsoft and Alphabet.
KOSPI slumps 5.6%, a day after its record rally
The KOSPI slumped 5.6% on Monday as traders resumed selling the market's heavyweight AI stocks. The move came a day after the index's record 18% surge on Friday. The benchmark had already suffered a 22% plunge in July, its steepest monthly decline since the 2008 financial crisis, as concerns over AI valuations triggered a broad correction.
Samsung Electronics fell 7.2% on Monday. The chipmaker had reported a more than 250-fold jump in semiconductor profit last week and announced multi-year supply deals with data-centre operators.
SK Hynix also dropped 7% as investors reassessed record quarterly earnings that fell short of elevated expectations. The two chipmakers together account for more than half of the KOSPI's market capitalization.
Japan slips, China and Hong Kong hold up better
Japan also traded lower after the Bank of Japan reinforced expectations for gradual policy normalization last week while keeping rates unchanged. The Nikkei 225 fell 1%. The broader TOPIX lost 1.2%.
Sony Group dropped nearly 6%, and Murata Manufacturing and Renesas Electronics also declined. Those losses offset gains of nearly 7% in Kioxia Holdings. TDK Corp gained more than 4%.
Chinese markets were comparatively resilient despite weakness in technology shares. The CSI 300 fell 0.6%. The Shanghai Composite lost 0.5%.
Hong Kong's Hang Seng edged 0.1% higher. Alibaba surged more than 5% after unveiling a new flagship AI model. Tencent gained over 2%.
Oil slide lifts Australia; RBI decision looms
Brent crude extended Friday's losses. President Trump said negotiations over the Strait of Hormuz would begin on Monday, reviving hopes of a diplomatic breakthrough with Iran and easing concerns over an energy-driven inflation shock.
Woodside Energy fell about 3%, tracking the weaker oil prices. Santos lost more than 2%. Japan's INPEX Corp declined roughly 2%.
Australia's S&P/ASX 200 outperformed the region, rising about 0.5%, as gains in financials and industrials offset weakness in energy stocks.
Attention now turns to the Reserve Bank of India, with India's Nifty 50 rising nearly 1% ahead of this week's rate decision. DBS economists expect the RBI to leave rates unchanged while maintaining a balanced stance, arguing that easing food inflation gives policymakers room to wait. Markets will also watch China's July trade data, South Korea's inflation report and Friday's U.S. nonfarm payrolls report.
Source: Investing.com
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