Global Markets
Kospi halted after 8% plunge as Asia follows Wall Street's AI chip rout
Seoul triggered a circuit breaker and Tokyo fell about 5% on Friday after the Nasdaq's worst session since April 2025.
HedgeWeekly News Desk ·
South Korea's Kospi index fell as much as 8.5% to 4,923 in early trade on Friday, triggering a circuit breaker that halted trading for 20 minutes, AFP reported. Japan's Nikkei 225 dropped 5.1% to 56,930 points in the same session. Reuters put the declines at more than 8% for the Kospi and 5% for the Nikkei.
Chip and memory names led the losses. Samsung Electronics fell nearly 10%, SK hynix more than 11%, Tokyo Electron about 9% and Kioxia 13%, according to AFP. The moves followed Thursday's US session, when the Nasdaq closed down 5.5% and the Philadelphia Semiconductor Index slid 12.2%. Reuters said the Nasdaq is now 12% below its record close of a month earlier and that about $3 trillion was erased from S&P 500 companies.
Investors are worried that Democrats' gains in this week's US midterm elections will bring tighter regulation of artificial intelligence, Reuters reported. Other stated concerns were a possible slowdown in AI infrastructure spending, doubts over returns on the large sums being invested, and local opposition to data-centre construction. Asian bonds were poised to gain and the dollar slipped against the yen and the Swiss franc.
For funds and allocators, the session shows how concentrated Asia's index weights are in a handful of AI-linked hardware makers: a single US-driven move took the Kospi into a trading halt. Reuters quoted Nick Ferres of Vantage Point Asset Management in Singapore saying Treasuries could rally much further and expecting an ugly day for semiconductor and memory stocks. Watch whether Korean and Japanese chip shares stabilise at Monday's open and how US semiconductors trade after today's jobs report.