South Korea’s benchmark Kospi index fell nearly 6% on Friday, marking a second consecutive day of sharp declines as investors aggressively locked in profits following a prolonged rally driven by artificial intelligence stocks.
The steep sell-off underscores the fragility of the recent market upturn, which had been heavily concentrated in the technology sector.
The Korea Herald reported that the decline was fueled by widespread profit-taking, indicating that the rally may have reached a short-term exhaustion point.
With AI-related equities having led the broader market higher for months, the sudden reversal suggests that traders are increasingly wary of extended valuations and are prioritizing capital preservation over further upside.
The Korea Herald reported that the decline was fueled by widespread profit-taking, indicating that the rally may have reached a short-term exhaustion point.
The breadth of the selling pressure across the index points to a broader risk-off mood rather than isolated weakness in specific names.
Market participants will now be watching for signs of stabilization in the coming sessions.