Asian markets experienced broad weakness on Monday, with South Korea’s Kospi benchmark declining 4.5% amid a selloff in technology and artificial intelligence-related equities. The index, which had benefited significantly from global enthusiasm for AI investments, fell to 6,516.27. Major holdings in the index posted notable losses, including Samsung Electronics, which fell 4.7%, and SK Hynix, a memory chip manufacturer that declined 4.5%.
Taiwan’s Taiex also struggled, dropping 0.5%, though Taiwan Semiconductor Manufacturing Co. bucked the trend with a 1.3% gain despite having fallen 7.3% on Friday following an announcement of additional capital spending for U.S. manufacturing expansion. Other regional indices showed mixed results, with Hong Kong’s Hang Seng rising 1.7% and the Shanghai Composite edging 0.1% lower. Australia’s benchmark fell 0.1%, while India’s Sensex slipped 0.7%.
The decline in AI-related shares reflected broader concerns about valuation sustainability in the sector. Market participants have increasingly questioned whether spending commitments match realistic returns, prompting profit-taking after substantial recent gains. The situation intensified with the rollout of a new Chinese artificial intelligence model by Moonshot AI, which triggered comparisons to earlier market disruptions caused by rival Chinese AI developments.
Crude oil prices surged amid geopolitical tensions between the United States and Iran. Brent crude rose 3.2% to $90.95 per barrel, while U.S. crude climbed 2.8% to $84.04 per barrel. The escalation reflected recent strikes between the two nations and mounting concerns about potential wider regional conflict. Analysts warned that disruptions to shipping through the Strait of Hormuz, a critical conduit for global oil transport, could significantly constrain supplies if tensions continue to escalate.
On Wall Street, major indices closed the preceding week lower, with the S&P 500 falling 1%, the Dow Jones Industrial Average declining 0.8%, and the Nasdaq composite dropping 1.4%. Chipmaking stocks faced particular pressure, including Nvidia, which fell 2.2%. SpaceX shares declined 5.4% after trading below their initial public offering price of $135.