South Korean stocks faced a decline on Thursday morning due to ongoing volatility in major technology shares and concerns regarding escalating tensions between the United States and Iran. The benchmark Korea Composite Stock Price Index (KOSPI) dropped 1.62 percent to 7,605.91 after starting nearly 3 percent lower. This decline was influenced by the Dow Jones Industrial Average falling 1.87 percent, the S&P 500 dropping 1.62 percent, and the Nasdaq composite shedding 1.98 percent overnight.
Investors showed unease over the high valuation of artificial intelligence (AI) stocks, leading to a 3.73 percent dip in AI chip giant Nvidia, a 5.12 percent slide in Broadcom, a 28 percent tumble in Super Micro Computer, and a 4.86 percent drop in AMD. Additionally, market sentiment was impacted by the U.S. launching additional strikes against Iran and Iran threatening to fire on vessels passing through the Strait of Hormuz, raising concerns of a potential return to full-scale conflict.
The U.S. Consumer Price Index for May, a key inflation indicator, was softer than expected but failed to alleviate worries about a possible hawkish policy shift by the U.S. Federal Reserve. In Seoul, Samsung Electronics, the market top-cap, saw a 1.49 percent decrease, while chipmaking rival SK hynix gained 0.63 percent. Other notable movements included Samsung Electro-Mechanics dipping 3.38 percent, SK Group backtracking 2.76 percent, and Hyundai Motor slipping 4.32 percent.
Automaker Hyundai Motor’s sister company, Kia, contracted by 5.51 percent, while auto parts manufacturer Hyundai Mobis dropped 4.04 percent. LG Energy Solution, a leading battery maker, lost 1.69 percent, and Samsung SDI, its smaller rival, went down by 3.42 percent. Furthermore, power plant manufacturer Doosan Enerbility decreased by 5.38 percent, and defence giant Hanwha Aerospace plunged by 5.43 percent. The Korean won was trading at 1,528 won against the U.S. dollar at 11:20 a.m., down 3.8 won from the previous session.
