Asian stocks slump, Samsung plunges, Korean market halts trading again

(CNA Hong Kong, July 7, Comprehensive Foreign News) Asian stocks performed sluggishly today, with the Seoul stock market plummeting and triggering the circuit breaker mechanism again. Despite a significant increase in profits for chip giant Samsung, its stock price closed down more than 6%, raising concerns that the rally driven by artificial intelligence (AI), which has repeatedly hit new highs, may have come to an end.

According to Agence France-Presse, after the US stock market ended its holiday, the three major indices rose yesterday, driven by heavyweight companies such as Amazon and Apple. However, Asian stock investors failed to extend the gains of the US stock market.

As the market questions whether substantial investments in AI by companies will yield corresponding returns, yesterday's performance in the US stock market slightly eased concerns triggered by the pullback in technology stocks over the past few weeks.

Korean giant Samsung (Samsung) also announced today that the company expects operating profit in the second quarter to surge by more than 1800%, mainly due to the continued strong demand for AI-driven memory chips.

However, Samsung's stock price once fell by 10% during intraday trading, and finally closed down more than 6%, dragging down the Korean KOSPI index by nearly 5%. This further exacerbated the sell-off that has hit the market hard in the past two weeks.

The KOSPI index had doubled this year and reached a record high last month, but has since fallen by about 20%.

As the highly anticipated earnings season kicks off, investors will closely watch companies' outlooks for the AI industry after their substantial investments in AI.

Charu Chanana, a strategist at Saxo Markets, wrote: "Strong earnings are no longer enough. For AI-related stocks, the market currently demands clear evidence of outstanding performance and guidance, as well as sustained pricing power."

She added: "Investors are not paying for past performance, but for the future."

In addition to the Seoul stock market, the Tokyo stock market, which is also dominated by technology stocks, as well as the Hong Kong, Shanghai, Sydney, and Taipei stock markets, all closed lower.

The stock markets in Singapore, Manila, and Jakarta rose. (Compiled by Yang Zhaoyan) 0707

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