South Korean, Japanese stocks lead Asian markets down

The broader MSCI AC Asia Pacific x Japan index dropped nearly 0.7%, reversing part of Wednesday’s 1.5% rally

South Korean and Japanese stocks led declines across Asia on Thursday as renewed weakness in semiconductor shares prompted investors to take profits after the previous session’s AI-fuelled rally.

The broader MSCI AC Asia Pacific x Japan index dropped nearly 0.7%, reversing part of Wednesday’s 1.5% rally.

Technology stocks reversed part of Wednesday’s rally as investors reassessed AI valuations after a strong rebound over recent sessions.

The retreat came as traders reassessed semiconductor valuations, extending volatility that has dominated AI-related shares in recent weeks.

KOSPI tumbled more than 4%, marking the region’s weakest performance. SK Hynix slumped more than 8%, Samsung Electronics shed over 5%, while LG Innotek dropped around 6%.

Nikkei 225 declined nearly 1.2%, while the broader TOPIX shed 0.4%. Kioxia Holdings plunged around 9%, Murata Manufacturing declined over 8%, TDK slipped around 5%, while Sony bucked the trend with a gain of around 2%.

Chinese markets were comparatively resilient. The Shanghai Shenzhen CSI 300 slid almost 0.5%, while the Shanghai Composite dropped only 0.1%. Hang Seng slipped about 2%, with insurers leading declines after reports that Chinese authorities have begun enforcing taxes on investment income from offshore insurance policies.

S&P/ASX 200 slid after scaling a record high above 9,200 in the previous session. Investors also digested stronger-than-expected June trade data as miners gave back some of Wednesday’s gains through profit-taking.

In India, the Reserve Bank of India left its benchmark repo rate unchanged at 5.25% on Wednesday, as expected. Nifty 50 was little changed at open on Thursday.

FTSE Straits Times Singapore edged about 0.2% lower, tracking the softer regional tone despite continued resilience in bank stocks.