AI investment doubts drag Asian markets; South Korean chip stocks sink

Tokyo,UPDATED: Jul 29, 2026 10:08 IST

Asian markets mostly fell on Wednesday as fresh doubts over massive investments in artificial intelligence triggered a sell-off in technology shares, with South Korea taking the biggest hit. By midday in Seoul, the Kospi had dropped 8.2 per cent to 5,531.56, after only recently crossing the 9,000 mark and then falling back to its lowest level since early April.

The sharpest pressure came from chip stocks. SK Hynix tumbled 12.6 per cent after its operating profit for the last quarter missed analysts' forecasts, even though it rose sixfold to a record 60.5 trillion won (USD 41.2 billion). Samsung Electronics also fell 8 per cent. Other markets in the region were mostly lower, though Hong Kong and Australia bucked the trend.

In Tokyo, the Nikkei 225 lost 1.8 per cent to 61,038.63 after giving up early gains. Japanese stocks showed a mixed response to a major earthquake that hit the southern Kyushu region a day earlier. A previous earthquake in the area had caused heavy damage and disrupted automakers and other manufacturers. Shares of Nippon Paper, which owns a mill in the disaster zone that was badly damaged in Tuesday's quake, fell 1 per cent. Taiwan's Taiex shed 3.6 per cent, while the Shanghai Composite index slipped 0.5 per cent to 3,793.11. In contrast, Hong Kong's Hang Seng rose 1.7 per cent to 25,738.42 and Australia's S&P/ASX 200 gained 1 per cent to 9,036.90.

Oil prices, which had eased from the two-month high touched last week, rebounded. Brent crude climbed 4.2 per cent to USD 87.58 a barrel, while benchmark US crude also rose 4.2 per cent to USD 82.58. On Wall Street on Tuesday, stocks were mixed. The S&P 500 added 0.2 per cent and the Dow Jones Industrial Average rose 1 per cent, while the Nasdaq composite slipped 0.2 per cent. Most US stocks advanced after more companies reported stronger spring profits than analysts had expected. Coca-Cola gained 5 per cent after its revenue rose 7 per cent. But expectations of standout earnings continued to weigh on chipmakers and other companies that have benefited from the AI boom. Micron Technology, whose stock had more than tripled this year, fell 8.9 per cent, while Advanced Micro Devices dropped 8.1 per cent and Applied Materials lost 7.8 per cent.

In currency trading in Asia, the US dollar slipped to 163.57 Japanese yen from 163.81 yen, while the euro rose to USD 1.1399 from USD 1.1391. Overall, markets in Asia reflected renewed caution over AI-linked stocks, with South Korean chip shares leading the decline even as some regional benchmarks and oil prices moved higher.

With PTI Inputs

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