In brief
South Korean stocks opened in the red as concerns over AI infrastructure spending weighed on sentiment ahead of the U.S. midterm elections. The benchmark KOSPI dropped sharply, with major tech and industrial names falling, while oil prices slipped on hopes for a U.S.-Iran peace accord. Two Yonhap reports provide differing figures for the KOSPI decline, reflecting the market’s volatility.
The Seoul bourse opened sharply lower on Tuesday, with the benchmark Korea Composite Stock Price Index (KOSPI) dropping noticeably as investors weighed worries about heavy artificial‑intelligence (AI) spending and the uncertainty surrounding the U.S. midterm elections.
The first of two Yonhap reports, citing a 3.36 percent decline, put the KOSPI at 5,662.37 as of 9:15 a.m. (KST). A second Yonhap bulletin reported a 2.46 percent drop, leaving the benchmark at 5,715.19 at the opening bell. The difference between the accounts highlights the market’s nervous volatility at the start of the U.S. midterm campaign.
Across the market, flagship technology names spearheaded the slide. Samsung Electronics fell 4.59 percent, while chipmaker SK Hynix slumped 5.10 percent and Naver and Kakao were among the first to register losses at 1.30 and 1.10 percent, reflecting investor worries that the rapid roll‑out of AI could destabilise the economy.
Major industrial stocks also reflected the nervous sentiment. Hyundai Motor came in down 1.57 percent and Doosan Enerbility fell 3.77 percent, and the shipbuilder HD Hyundai Heavy Industries was down 2.26 percent. Defense giant Hanwha Aerospace declined 0.81 percent.
Oil prices were softer on optimism over a possible U.S.–Iran peace agreement, a move that lifted the mood for energy‑heavy sectors and reinforced global links between geopolitical events and the Korean market.
Meanwhile, the Korean won traded at 1,342.05 won per U.S. dollar at 9:15 a.m., up 3.95 won from the previous session’s close, further signalling that investors were looking for foreign‑exchange safe havens in an unsettled political environment.
Overnight, U.S. stocks closed mixed, reflecting their own focus on the U.S. midterm elections. The Nasdaq Composite and the S&P 500 closed 1.07 percent and 0.51 percent lower respectively, while the Dow Jones Industrial Average edged up 0.41 percent. Investors also watched U.S. tech and AI equities for clues on how policy changes after the elections could ripple through the global technology landscape.
Major South Korean banks and market analysts noted that the sharp drop was the biggest intraday slide since the market reopened earlier in the year. Analysts also warned that a surge in AI investment might accelerate job losses in certain labour‑intensive sectors, raising concerns about broader economic stability.
The day's trading will be closely watched as the midterm elections in the United States approach, with many hoping for a shift in policy that could directly impact South Korea’s technology and industrial sectors, especially as global conversations around AI regulation intensify.
