Asian markets retreat, with Korean shares slumping despite an AI-led rebound on Wall St

Asian shares retreated Tuesday, with South Korea's Kospi slumping nearly 5% despite a rebound for AI stocks on Wall Street, as Samsung Electronics shares fell 7.7% even after reporting a 19-fold surge in operating income. Oil prices rose and U.S. futures were mixed, with AI stocks under pressure from concerns about overvaluation and the sustainability of investment returns.

BANGKOK AP — Asian shares retreated Tuesday, with South Korea's Kospi sinking almost 5% despite a rebound for AI stocks https://apnews.com/article/stock-markets-iran-war-ai-21763c547c9aaaf13483625f90a751cd that lifted benchmarks on Wall Street. https://apnews.com/article/trump-wall-street-opening-bells-stock-market-e55efa6c06e6eef8feb9049a7800c136 Oil prices rose and U.S. futures were mixed. In Seoul, the Kospi dropped as much as 8% but recovered some losses to close 4.9% lower at 7,656.31. Shares in computer chipmaker Samsung Electronics slumped 7.7% even after it announced its operating income surged 19-fold to 89.4 trillion won $58.7 billion in the last quarter while its revenue more than doubled. SK Hynix lost 6.7%. Kim Seok-hwan, an analyst at South Korean securities firm Mirae Asset, attributed drop for Samsung to foreign investors locking in recent gains and rebalancing their portfolios. AI stocks have been gyrating on fears their prices have shot too high, raising questions about whether all the dollars flowing into AI chips and data centers can possibly create enough gains in productivity and profits to make back all the investments. "The first proper AI stress test may not have arrived with weak demand, a capex warning, or some sudden crack in the data center story. It may have arrived with Samsung posting an extraordinary quarter and the stock falling anyway," Stephen Innes of SPI Asset Management said in a commentary. SK Hynix will further test investors' appetite for AI this week, aiming to raise $28 billion by selling shares of stock that will trade in the United States on the Nasdaq. That would make it one of the biggest U.S. offerings ever, behind SpaceX's IPO from last month https://apnews.com/article/musk-spacex-tesla-ipo-trillionaire-billionaire-worth-rockets-7723f82b6063a9a17c194e25982cd66d , which raised $75 billion. The company's stock in Seoul has more than tripled so far this year because of the AI boom, despite sharp losses in recent weeks. Tokyo's Nikkei 225 declined 2.1% to 68,256.96. Computer chipmaker Tokyo Electron lost 3.9% and chipmaker Kioxia Holdings shed 11.3%. The Hang Seng in Hong Kong declined 0.7% to 23,444.20, while the Shanghai Composite index gave up 1.3% to 3,990.25. Taiwan's Taiex lost 2.3%. In Australia, the S&P/ASX 200 declined 0.3% to 8,803.90 and India's Sensex rose 0.5%. On Monday, the S&P 500 rose 0.7% to 7,537.54, pulling to within 1% of its all-time high https://apnews.com/article/stock-markets-iran-nvidia-energy-oil-ba4257d9938ef6aea558db3010b4a53f , even though the majority of stocks within the index fell. The strength for companies in the artificial-intelligence https://apnews.com/hub/artificial-intelligence technology industry sent the Nasdaq composite 1.1% higher, to 26,121.16. The Dow Jones Industrial Average rose 0.3%, to 53,055.91, a record. Broadcom was one of the strongest forces lifting the S&P 500. It rose 3.7% after announcing long-term agreements to provide silicon products to Apple. It was coming off two straight losses of more than 2% on Wednesday and Thursday at the end of last week, before Friday's holiday in advance of the Fourth of July https://apnews.com/article/stocks-markets-rates-ai-oil-trump-de7c9db96ce4d502079892d3ecef88cf .