Seoul: South Korean stocks ended over 1 percent lower Wednesday, snapping a two-day winning streak, as investors unloaded chip shares following Washington's decision to restrict Nvidia's artificial intelligence (AI) chip exports to China. The Korean won fell against the U.S. dollar.
According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) shed 29.98 points, or 1.21 percent, to close at 2,447.43. Trade volume was moderate at 601 million shares worth 6.66 trillion won (US$4.67 billion), with losers outnumbering winners 574 to 301.
Institutions and foreign investors sold a combined net 473 billion won worth of stocks, while retail investors purchased a net 381.5 billion won. Overnight, Wall Street closed slightly lower as lingering tariff uncertainty swayed investors to move to the sidelines. The S and P 500 fell 0.17 percent, the Dow Jones Industrial Average shed 0.38 percent, and the tech-heavy Nasdaq composite slid 0.05 percent.
Nvidia's stock declined almost 6 percent in after-hours trading, following the U.S. government's decision to restrict exports of the American chip giant's advanced H20 AI chips to China. "News that the U.S. government has decided to restrict exports of Nvidia's H20 chip has contributed to volatility in the South Korean stock market," said Han Ji-young, an analyst at Kiwoom Securities.
In Seoul, semiconductor and automotive shares led the overall decline. Market heavyweight Samsung Electronics plummeted 3.36 percent to 54,700 won, and its chip rival SK hynix plunged 3.65 percent to 174,000 won on the news of the U.S. export curbs. Top automaker Hyundai Motor retreated 2.83 percent to 181,700 won, and affiliate Kia slid 1.28 percent to 84,700 won.
Leading bio firm Samsung Biologics fell 1.06 percent to 1,023,000 won, and top battery manufacturer LG Energy Solution dropped 0.58 percent to 343,000 won. In contrast, financial and defense equipment shares advanced. Kookmin Financial climbed 2.56 percent to 80,000 won, while missile systems manufacturer Hanwha Aerospace rose 2.2 percent to 788,000 won following its announcement to establish a missile joint venture with Poland's WB Group.
The local currency was quoted at 1,426.7 won against the U.S. dollar at 3:30 p.m., down 1.2 won from the previous session.