Wall Street is getting trampled by an AI sell-off. South Korean market plunges 10%

Key Points:

• Volatility has surged in global stock markets, with South Korea's Kospi index plunging 10% and triggering a circuit breaker due to sharp declines in major chipmakers SK Hynix and Samsung, which constitute about half of the Kospi's market value.
• The sell-off follows mild tech stock declines in the US, where the Nasdaq dropped 1.3% for the second consecutive day, influenced by jitters over AI sector developments and concerns about potential Federal Reserve interest rate hikes.
• Major tech companies such as Google, SpaceX, Nvidia, and Oracle experienced significant share price drops, contributing to broader market unease, while semiconductor stocks like Micron and Marvell also fell sharply.
• Analysts suggest the market nervousness stems from AI companies’ high valuations and growth expectations, combined with uncertainty about Federal Reserve policies, causing investors and trading algorithms to react swiftly to market shifts.
• The sell-off in South Korea spread across Asia, with Japan's Nikkei falling 3.6% and Softbank down 15%, although overall tech stock declines remain moderate compared to recent highs, as markets continue to focus on AI and interest rate outlooks amid easing geopolitical tensions.