South Korean stocks fell over 1% on Wednesday, ending a two-day rally, as investors sold off chip shares after the US curbed Nvidia's AI chip exports to China.
Nvidia expects a $5.5 billion hit due to this move, which restricts the sales of its China-tailored H20 AI chip, and requires a special license for future exports. The move, part of Washington's push to curb China's AI progress, sent Nvidia shares tumbling in after-hours trading.
The Korea Composite Stock Price Index, or Kospi, fell 29.98 points, or 1.2%, to close at 2,447.43. The Kosdaq also declined by 12.81 points, or 1.8%, to 699.11.
In economic news, South Korea's export price index, measured in Korean won, rose 6.3% year on year in March, while the import price index increased 3.4%, the Bank of Korea reported Wednesday.
On an on-month basis, the export price index and the import price index increased 0.3% and declined 0.4%, respectively, the South Korean central bank said.
The net barter terms of trade index rose 0.8% on-year during the month.
In corporate news, steelmaker Hyundai Steel (KRX:004020) said Tuesday it had finalized a 2024 wage agreement with its labor union, ending a string of strikes and production disruption.
The deal includes a monthly base salary increase of 101,000 won and bonuses worth 4.5 months' pay plus 10.5 million won. The union accepted the deal, despite calling the outcome "unsatisfactory." The deal came amid a tough global steel market, trade tensions, and Hyundai Steel's ongoing emergency management mode.
The company had temporarily shut down its cold-rolled steel plant in Dangjin from Feb. 24 to Mar. 31 following prolonged labor disputes.
Shares of Hyundai Steel fell over 2% at market close on Wednesday.
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