Stocks in South Korea, Japan Fall Amid Tech-Heavy Selloff

By Sherry Qin

South Korean and Japanese stocks sold off after notching several record highs in recent sessions amid sharp shifts in global AI sentiment and macroeconomic events.

In South Korea, the pair of memory chip makers Samsung Electronics and SK Hynix, which make up around half of the benchmark index Kospi's market capitalization, fell 7.4% and 10.1%, respectively. The Kospi fell 8.1%, triggering a 20-minute trading suspension, the fourth such move this year.

In Japan, the Nikkei Stock Average was last 3.0% lower. The sharp decline was led by the tech conglomerate Softbank Group and chip maker Kioxia, which slumped 9.5% and 13%, respectively. Chip-equipment maker Tokyo Electron shed 4.6%, while Ibiden put off 6.6%.

Both the Kospi and the Nikkei Stock Average have recently seen several record highs, fueled by enthusiasm over artificial intelligence, U.S.-Iran peace talks and the Bank of Japan's move to tighten policy.

Investors have been piling in memory stocks as such chips--some of the world's most profitable products, with demand looking unlikely to cool anytime soon.

SK Hynix overtook Samsung as South Korea's most valuable company on Monday after becoming the latest company to ride the AI-chip boom into the elite $1 trillion market-cap club in May.

The surging stock prices have made them more susceptible to volatility, and analysts have warned about their stretched valuations and exposure to the semiconductor cycliaclity.

The two East Asian markets' losses followed the Nasdaq's falls overnight. SpaceX, which makes up about 5% of the Nasdaq, fell 16%, marking its third straight decline. An even bigger Nasdaq component, Alphabet, suffered its worst day in more than a year, down about 5% amid concerns about its AI business.

Write to Sherry Qin at sherry.qin@wsj.com

(END) Dow Jones Newswires

June 23, 2026 02:27 ET (06:27 GMT)