finance
Asian Markets Drop, South Korea's Kospi Falls 5.8% After 8% Intraday Drop Triggers Trading Halt
South Korea's Kospi index dropped 5.8 percent after an 8 percent decline triggered a trading halt. Technology shares led losses across the region amid concerns over valuations and rising component costs.
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Asian stock markets fell sharply on Friday, led by a sell-off in technology firms. Trading on South Korea's Kospi index was temporarily halted after the benchmark fell 8 percent, triggering a mechanism to curb panic selling, bbc.co.uk reported. The index closed 5.8 percent lower.
Friday's 20-minute halt marked the third time the circuit breaker has been triggered this week and the fifth such event this year. Japan's Nikkei 225 closed more than 4 percent lower, with shares in SoftBank falling 12.5 percent. Major indexes in Taiwan and mainland China were also sharply lower.
The moves followed announcements from Apple and Microsoft. Apple said it would raise prices on iPads and MacBooks due to higher chip costs. Its shares dropped 6 percent on Thursday, the largest one-day decline in more than a year.
Microsoft announced higher prices for Xbox consoles citing component costs, and its shares fell the same day. Big tech firms are spending hundreds of billions of dollars this year on artificial intelligence infrastructure. Traders are reassessing valuations after recent rallies, said senior partner David Makaryan from the Alpha Pacific Group.
"The long term investment case for AI remains compelling, but investors are becoming far more selective about which companies can justify the valuations the market has assigned to them," Makaryan said. Analyst Raymond Woo from Kyoto University Innovation Capital noted that high costs of commercializing AI tools are being passed to consumers, raising questions about demand matching investment levels.
