High Yields Pressure Chip Stocks, Korean Shares Hit Hardest, "Investors Unwilling to Pay High Premiums Anymore"

Odaily News: South Korean stocks led the decline in Asian chip stocks on Wednesday morning, as rising bond yields intensified concerns over the massive capital spending by tech giants. South Korea's KOSPI index fell as much as 6.8% at one point, while the Asian semiconductor stock index dropped over 2%. These losses echoed the slump in U.S. semiconductor and other AI-related stocks. Bond yields have remained elevated amid concerns over inflation and rising government debt. The risk of further increases in borrowing costs, compounded by ongoing uncertainties surrounding the war in Iran, further exacerbated market worries.

The CEO of Fibonacci Asset Management stated that although the logic of AI growth remains intact in the long term, "rising interest rates and geopolitical risks are making investors reluctant to pay high premiums for this growth any longer." He added that after an "exceptionally strong rally," the stock pullback also reflects a certain degree of profit-taking by investors.