Stock markets around the world experienced significant declines as technology shares fell sharply. The downturn was led by chip manufacturers, particularly those in South Korea, causing the main index to plunge by 10 percent there. European markets also saw lower stock values, with S&P 500 futures suggesting further substantial drops.
South Korea’s major chip companies, crucial to recent advancements in artificial intelligence, faced severe losses. The decline in their shares, which began in the United States on Monday, quickly spread globally. Asian markets were significantly impacted, illustrating the interconnected nature of global finance.
Leading U.S. tech firms, including Alphabet and Amazon, saw continued decreases in premarket trading on Tuesday, worsening losses from the previous day. SpaceX’s stock was also affected, having dropped over 20 percent in value in three trading sessions. Despite these reductions, it remains above its initial public offering price.
The decline in South Korea was notably sharp, affecting the Kospi index. This index, which had been the world’s best performer since early 2025, fell by 10 percent, activating a 20-minute trading halt. Its growth had been driven largely by two of the nation’s largest memory chip makers, Samsung Electronics and SK Hynix. These companies are instrumental in the production of semiconductors necessary for AI systems. Their soaring stock prices had previously attracted many retail investors.
Shares in Samsung Electronics and SK Hynix dropped more than 12 percent on Tuesday. According to Alexander Redman, chief equity strategist at CLSA, such a dramatic one-day drop would historically lead to panic. However, this type of volatility seems to be an expected aspect of current market behavior. Redman commented on this situation at the company’s investor conference in Seoul, noting the unsettling intensity of market fluctuations.
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