Trading on South Korea's Kospi index was suspended temporarily on Tuesday morning after the benchmark fell 8%, marking a sharp escalation in the ongoing sell-off of artificial intelligence-related equities.
The halt underscores the severity of the market's retreat from the sector that has driven global equity gains for much of the year.
The turmoil spread across major markets, with shares in leading chip manufacturers declining sharply in both the US and Asia.
The broad-based nature of the decline suggests a coordinated unwind of leveraged positions and a reassessment of valuations in the AI hardware complex, rather than a reaction to a single company-specific event.
This development follows a week of intense pressure on semiconductor stocks, with optical interconnect and memory chip names leading the decline.
The relentless rally in AI hardware is encountering significant headwinds as investors question the sustainability of current multiples amid shifting demand signals.