South Korean Stocks Enter "Technical Bear Market," Down 20% From February Highs
The South Korean stock market has entered a technical bear market, with the Kospi index falling 20% from its February high. Tensions in the Middle East are driving up oil prices, fueling inflation concerns and dampening risk appetite in the tech sector. Shares of Samsung Electronics and SK Hynix both dropped over 5%, dragging down the index. Investors are questioning the sustainability of AI-driven demand for memory chips. Market risk warning: investment requires caution
South Korea's benchmark stock index declined as escalating tensions in the Middle East pushed oil prices higher, fueling inflation concerns and dampening risk appetite for the tech-heavy market. South Korea's Kospi index fell as much as 4.4%, bringing its decline to about 20% from a record closing high reached at the end of February. The country's two largest companies by market capitalization, Samsung Electronics and SK Hynix, both dropped more than 5%, contributing the most to the index's decline. The pullback highlights the rapid shift in sentiment in a market closely tied to AI-driven spending. Concerns about accelerating inflation cast a shadow over the outlook for interest rates, leading investors to question whether the AI boom fueling demand for memory chips can be sustained.
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