Chip makers and tech investors such as Samsung and SoftBank plunge as potential interest rate hikes spook markets

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An accelerating sell-off of AI-linked shares has hit global markets, as fears over rising inflation and future interest rate hikes spooked traders already wary of the heavily indebted sector.

South Korea’s benchmark Kospi 200 index, which is heavily skewed towards the companies that make memory chips, fell more than 8% overnight to a six-month closing low, triggering circuit breakers that brought trading to a halt at various points.

TOKYO – China gave global investors one of 2026’s biggest AI thrills. Yet the country that helped ignite excitement about artificial intelligence is home to one of the worst-performing major stock markets. While AI fever has propelled Seoul, Taipei and Tokyo higher, Chinese shares are stuck in reverse.

So what gives? Several forces, actually. Weak household demand, for one. Consumer spending continues to disappoint, weighing on the earnings potential of mainland internet companies, automakers, and retailers.

The post Why China is missing the big AI rally appeared first on Asia Times.