Asian markets mixed as AI selloff deepens; South Korea's Kospi slides nearly 5%

Hong Kong: Asian stock markets were mixed on Monday as a continuing selloff in artificial intelligence-linked shares weighed heavily on technology-heavy indexes, while escalating tensions in the Middle East pushed oil prices above US$90 a barrel. South Korea's Kospi suffered the steepest decline in the region, dropping 4.9 per cent to 6,490.97 as investors continued to pull back from AI-related stocks following recent gains. Among the index's biggest decliners were technology heavyweights Samsung Electronics, which fell 4.4 per cent, and memory chip manufacturer SK Hynix, down 3.3 per cent. Taiwan's Taiex index was little changed, edging down less than 0.1 per cent. However, Taiwan Semiconductor Manufacturing Co. (TSMC) gained 2 per cent, recovering some ground after tumbling 7.3 per cent on Friday following plans to invest an additional US$100 billion in US chipmaking operations. Elsewhere in the region, Hong Kong's Hang Seng Index rose 2.1 per cent to 25,105.78, while mainland China's Shanghai Composite Index gained 1.2 per cent to 3,808.39. Australia's S&P/ASX 200 added 0.2 per cent, while India's Sensex fell 0.9 per cent. Japanese markets were closed for a public holiday. AI concerns weigh on sentiment Technology stocks remained under pressure following a global retreat in AI-related shares that began last week. Investors have grown increasingly cautious about soaring capital spending on artificial intelligence, amid concerns that the sector may be overheating after a prolonged rally. Market sentiment was further affected by the launch of Kimi K3, a new open-source artificial intelligence model developed by Beijing-based startup Moonshot AI. Analysts said the release revived concerns about rising competition from lower-cost Chinese AI platforms, echoing the market reaction triggered by China's DeepSeek model in early 2025. The selling pressure extended to Wall Street on Friday, where semiconductor stocks led losses. The S&P 500 finished down 1 per cent at 7,457.69, while the Dow Jones Industrial Average fell 0.8 per cent to 52,146.42. The technology-focused Nasdaq Composite declined 1.4 per cent to 25,520.24. Among major technology names, Nvidia fell 2.2 per cent, while Broadcom and Advanced Micro Devices (AMD) each lost about 1 per cent. Oil climbs above US$90 Meanwhile, energy markets remained focused on escalating hostilities between the United States and Iran. Brent crude, the international benchmark, rose 2.6 per cent to US$90.40 a barrel, while US benchmark crude gained 2.2 per cent to US$83.58 a barrel. Analysts said concerns over disruptions to shipping through the Strait of Hormuz, a critical route for global oil supplies, continued to support prices. Currencies In currency trading, the US dollar slipped slightly to 162.37 Japanese yen from 162.43 yen, while the euro strengthened to US$1.1446 from US$1.1438. Investors will continue to monitor developments in both the AI sector and the Middle East conflict, with concerns over technology valuations and energy security expected to remain key drivers of market sentiment in the days ahead.