The US and European stock markets might be numb to the enormity of the AI bubble at this point, but in East Asia it’s a different story.
In South Korea, the AI bubble appears to be bursting — at least partially — with the Korea Composite Stock Price Index (Kopsi) plummeting by over 40 percent from its June highs after the Korean chipmaker SK Hynix failed to impress investors despite reporting a sixfold increase in quarterly earnings.
Across July 28 and 29, Seoul Economic Daily reports widespread panic triggered not just one but two “circuit breakers” on the Korea Exchange, a sort of automated kill switch that halts regular trading for 30 minutes so panic-stricken traders can gather their thoughts.
The recent panic marks the first time the Kopsi has ever triggered two consecutive circuit breakers, and only the 14th and 15th Kopsi activations in the Korean Exchange’s history. The tech-heavy Korea Securities Dealers Automated Quotations, or Kosdaq, also reached circuit-breaker-tripping levels two days in a row for the third time ever — the previous incidents coming in 2020 and 2008, if that’s any indication of the amount of turbulence roiling Korean financial markets.
