Concerns over AI leverage betting intensify as Korean stocks plunge 5%

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Golden Finance reported that on July 20, Monday, South Korea’s KOSPI index fell 5%, and investors rushed to close positions related to artificial intelligence. The index is currently continuing a four-week streak of losses and is down 28% from its historical peak on June 22. This selloff reflects investors’ growing anxiety about the market’s increasing reliance on leveraged bets on AI chip manufacturers. South Korea has become an important barometer of the AI boom; as market sentiment turns negative, the country is starting to feel additional downward pressure. “Although South Korea is still considered a preferred market in our allocation model, due to ongoing market volatility, we have lowered our rating from overweight to neutral,” a Citigroup analyst said. They maintained their target of 10,000 points for the South Korean KOSPI index. (Jin10)
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