The benchmark Korea Composite Stock Price Index (KOSPI) fell 151.59 points (3.79%) to close at 3,853.26.
The index opened lower, tracking Wall Street’s overnight losses, then widened further as investors were wary of the valuations and aggressive investment plans of AI stocks.
The US Federal Reserve’s monetary policy also had an impact on sentiment, as expectations for further interest rate cuts continued to decline.
“The market has given up the gains from Nvidia’s surprise earnings yesterday. Volatility seems to be continuing after the recent surge,” said Han Ji-young, a researcher at Kiwoom Securities.
“However, there is still a good chance that sentiment could reverse depending on key economic indicators and further developments related to AI,” the analyst added.
As of 3:30 p.m., the local currency was trading at 1,475.6 won against the dollar, 7.7 won weaker than the previous transaction.
This was the lowest price since April 9th, when it hit 1,484.1 won. This April 9 figure was the lowest since March 12, 2009, when the won closed at 1,496.5 won during the global financial crisis.
Earlier, Qazinform news agency reported that Nvidia beat expectations as AI demand drives record profits.
