A sell-off in AI-related shares deepened on Tuesday, pushing South Korea's stock market to its lowest level in three months, as investors grew increasingly anxious about heavy borrowing by AI firms to fund datacentre expansion. Chipmakers Samsung Electronics and SK Hynix each fell by more than 10%, dragging down the Kospi index, in a move analysts linked to fresh doubts over AI investment spending and intensifying competition from Chinese rivals.

The slide followed a report that China had begun mass-producing its own deep ultraviolet chip-making tools, stoking fears about the country's growing capability in semiconductor equipment, while shares in Chinese memory chipmaker CXMT surged 466% on their Shanghai listing. Concerns also mounted over "circular funding" within the AI sector, after reports that Nvidia was in talks to provide $250bn (£188bn) towards a huge OpenAI datacentre project in Ohio; news of the discussions sent Nvidia's shares down 5% and pushed up the cost of insuring its debt against default.