New Delhi, Oct. 20 -- South Korea's stock market is facing a deepening sell-off as concerns over artificial intelligence (AI) spending, semiconductor valuations and rising financing costs rattle investors. The benchmark KOSPI fell another 5% on Tuesday, extending its losses as investors pulled back from AI-linked stocks.

The index had surged earlier this year, with its gains reaching around 116% at its record close in June. However, the subsequent correction has erased much of that rally, leaving the KOSPI up approximately 30% in 2026. The index has also fallen 39% from its peak of 9,386 earlier this year to 5,493.24 currently.

The sell-off accelerated in July, when the KOSPI fell 22%, and continued into October, with the index losing a...