KOSPI traded 0.5% lower after swinging between gains and losses

Most Asian stock markets dropped on Thursday, with South Korea surrendering early gains in a volatile session, as investor worries around artificial intelligence-related spending persisted despite strong earnings from Samsung Electronics.

KOSPI traded 0.5% lower after swinging between gains and losses. It had soared around 5% at the open, sparking hopes that this week’s AI-driven selloff had bottomed out, but later reversed course as semiconductor stocks came under renewed pressure.

The benchmark index has declined almost 17% in the last two sessions.

Samsung Electronics on Thursday reported a sharp rise in second-quarter earnings, with semiconductor operating profit soaring more than 250-fold from a year earlier as demand for high-bandwidth memory (HBM) chips used in artificial intelligence servers remained robust.

Samsung shares traded 2% higher, after gaining 8% after the results were announced.

SK Hynix reversed course to drop nearly 4%, extending this week’s steep losses after its quarterly results failed to satisfy lofty investor expectations despite record profits.

South Korean equities remained fragile after one of their worst consecutive declines. Investors questioned whether record AI-related capital spending by international technology companies would translate into stronger earnings.

Nikkei 225 added 1%, bucking the trend, while the broader TOPIX index shed 0.4%.

Markets were lower, with Shanghai Composite dropping 1.2% and the blue-chip CSI300 sliding 2.2%. Hang Seng traded largely unchanged.

S&P/ASX 200 slipped 0.7%, while Straits Times Index slid 0.9%.

Futures tied to Nifty 50 were muted.

Elsewhere, U.S. stock market’s weakness overnight and intensifying competition from Chinese AI firms further weighed on sentiment across the semiconductor sector.

Investors also digested earnings from Microsoft and Meta Platforms.