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Seoul stocks opened lower on Wednesday, partly driven by investors pulling out of stocks related to artificial intelligence (AI) in the U.S. market. The benchmark Korea Composite Stock Price Index (KOSPI) was down 75.79 points, or 0.87 percent, to 8,650.81, as of 9:15 a.m. The index followed declines on Wall Street overnight, where a tech sell-off knocked down the S&P 500 by some 0.5 percent and the Nasdaq by 1.15 percent.

Coverage comparison

The opening decline was reported by Yonhap News, which noted that the index had opened lower amid investor caution ahead of the Federal Reserve's policy update due Wednesday (U.S. time) afternoon. Some investors expressed concern that the new Fed chair could signal a more hawkish tone in this first meeting. The same wire service also carried a separate report indicating that the KOSPI had opened 104.47 points, or 1.2 percent lower, at 8,622.13, before the updated figure of a 0.87 percent decline was provided.

Key claims

  • Nvidia surprised investors with a plan to issue US$25 billion worth of bonds, marking the chip giant's first bond sale in five years. Its shares fell 2.4 percent.
  • Market top-cap Samsung Electronics fell 2.41 percent, while its rival SK hynix inched up 0.76 percent.
  • Top carmaker Hyundai Motor dipped 3.2 percent, and major financial group KB Financial fell 1.63 percent, while defense giant Hanwha Aerospace moved up 2.28 percent.
  • The Korean won was trading at 1,510.4 won against the U.S. dollar, as of 9:15 a.m., up 1.2 won from the previous session.
  • An analyst from Kiwoom Securities, Han Ji-young, was quoted as saying: "Given that overall market conditions are neutral or better, the market is expected to rotate away from semiconductors to other sectors and narrow losses."
Separately, a report on Friday's trading noted that South Korean stocks started a tad lower following tech losses on Wall Street and a sharp rise the previous session, as investors worried about the valuation of AI-related shares and a possible rate hike by the Federal Reserve. The KOSPI lost 152.4 points, or 1.71 percent, to 8,777.9 as of 9:15 a.m., after opening 1.31 percent lower. The index had spiked 5.42 percent the previous day. Overnight, U.S. stocks closed mixed as investors remained doubtful of large-scale AI investments and their profits, while data showed that U.S. consumer prices rose 4.1 percent in May, raising possibilities that the Federal Reserve would increase key rates. The S&P 500 lost 0.01 percent and the Nasdaq composite fell 0.46 percent, while the Dow Jones Industrial Average rose 0.14 percent. In Seoul, Samsung Electronics retreated 1.67 percent and SK hynix fell 1.68 percent. Hyundai Motor dropped 2.78 percent and Kia declined 2.51 percent. Hanwha Aerospace slid 4.68 percent and Doosan Enerbility dipped 3.3 percent. The Korean won was trading at 1,548.3 won against the U.S. dollar, down 6.2 won from the previous session.