South Korea's Kospi plunges 8% as chip firms' shares tumble
South Korea's Kospi index dropped 8% on Tuesday after major chipmakers Samsung Electronics and SK Hynix saw their shares fall sharply, down as much as 9.5% and 11.1%.
The big selloff was sparked by worries over growing competition from Chinese tech firms and uncertainty around funding for AI infrastructure.
SK Hynix's U.S.-listed stock even slipped below its IPO price, closing at $143.02.
Investors worry over Chinese chip competition
Investors are nervous because Chinese companies are making progress with new chip-making tech, which could boost China's memory-chip output and heat up global competition.
Plus, the rise of cheaper Chinese open-source AI models has people questioning whether demand for advanced AI chips will stay strong.
With earnings reports coming up soon, analysts say investors are feeling cautious about what's next for the industry.