South Korea, Taiwan stock decline

INDONESIA: Semiconductor-driven stock markets of South Korea and Taiwan led declines in Asia on Tuesday following a global slide in equities, while regional currencies weakened against a steady dollar.

The moves underscored lingering uncertainty around tech earnings, with AI-darling Nvidia’s Wednesday results poised to test investor nerves over lofty valuations in the artificial-intelligence sector.

Chipmaker-heavy South Korean shares closed 3.3 percent lower, falling below the key 4,000 level, just a day after the benchmark jumped nearly 2 percent, as a tech selloff swept through the market.

Among index heavyweights, chipmaker Samsung Electronics fell 3.1percent, while peer SK Hynix lost nearly 6 percent. Battery maker LG Energy Solution slid 4.3 percent.

Taiwan stocks followed suit to lose 2.5 percent with shares of contract chipmaker TSMC down 2.8percent.

Japan’s Nikkei ended 3percent lower, as investors pulled out of tech stocks while sentiment further weakened as a diplomatic rift with China deepened, amplified by Tokyo’s recent safety warning for its citizens there.

The MSCI index of emerging Asia equities and a broader gauge of Asian shares outside Japan dropped about 2 percent each, while the MSCI ASEAN index lost 0.6 percent.

“Today’s declines across most emerging Asian equity markets reflect a combination of global and regional risk aversion,” said Tareck Horchani, head of dealing, prime brokerage, Maybank Securities.

“Caution over stretched valuations in big tech and AI stocks, which have powered this year’s rally, is prompting a rotation out of high-growth names, spilling into emerging Asian equities with heavy tech exposure.”