South Korean shares end lower as AI worries overshadow auto gains

SEOUL: Round-up of South Korean financial markets:

South Korean shares closed marginally lower on Thursday, as chipmakers fell on worries about overvaluation of artificial intelligence stocks, countering gains in automakers.

The benchmark KOSPI closed down 7.79 points, or 0.19%, at 4,028.51.

U.S. stocks closed higher on Wednesday, as a flurry of economic data kept expectations elevated for an interest rate cut by the Federal Reserve next week.

However, Microsoft fell as much as 3% after a report said the tech giant has cut AI software sales quotas, while chipmakers Nvidia and Micron Technology also declined.

Chipmaker SK Hynix ended down 1.81%, tracking overnight losses in U.S. peers, although rival Samsung Electronics erased early losses to close up 0.57%.

“The KOSPI gave up some of gains from the previous session, as the overall semiconductor sector fell,” Daishin Securities analyst Lee Kyoung-min said, adding that most foreign outflows were from the sector.

Foreigners were net sellers of shares worth 696.3 billion won ($472.58 million).

Hyundai Motor and sister automaker Kia Corp rose 6.38% and 1.43%, respectively, after the U.S. finalised a cut in auto tariffs to 15% from the current 25%.

Among other index heavyweights, battery maker LG Energy Solution slid 1.91%, while steelmaker POSCO Holdings shed 0.65%. Drugmaker Samsung BioLogics rose 1.57%.

Of the total 927 traded issues, 285 shares advanced, while 594 declined.

The won was quoted at 1,473.5 per dollar on the onshore settlement platform, 0.45% lower than its previous close at 1,466.9.

In money and debt markets, December futures on three-year treasury bonds gained 0.06 point to 105.45.

The most liquid three-year Korean treasury bond yield fell by 1.4 basis points to 3.029%, while the benchmark 10-year yield rose by 0.5 basis point to 3.378%.