KOSPI plunges 3.7%, Nikkei slides as Nvidia earnings jitters hit Asia

Asian shares weakened on Tuesday, with South Korea’s KOSPI and Japan’s Nikkei 225 leading a technology selloff as investors cut risk before Nvidia’s earnings.

The KOSPI fell as much as 3.7% shortly after the open before trimming its decline to about 1.8% by late morning. The Nikkei 225 slipped around 0.8% to 64,980, extending its losing streak to a third session.

The declines followed another weak US technology session as investors reassessed AI spending, Samsung Electronics’ shareholder-return plan and lofty expectations around Nvidia.

KOSPI bears the brunt of the chip selloff

South Korean technology shares remained the region’s pressure point. Samsung Electronics fell about 2.5% in late-morning trading, while SK Hynix dropped 4.6%.

Foreign investors sold a net 2.11 trillion won of Korean shares, while retail and institutional buying helped the benchmark recover from its intraday low.

Samsung’s record shareholder-return proposal has become an unexpected drag.

The company outlined returns of 90 trillion won to 110 trillion won, but investors were disappointed by the lack of clearer commitments on buybacks and treasury-share cancellations.

Daishin Securities analyst Lee Kyoung-min told Yonhap that disappointment around the plan had weighed on the KOSPI and other Samsung companies.

The selloff also reflects positioning before Nvidia reports on Wednesday.

Expectations centre on quarterly revenue of roughly $92 billion, leaving little tolerance for signs that AI infrastructure demand is slowing.

Nikkei slips below 65,000 as chip caution spreads

The Nikkei’s decline was milder but similarly concentrated in technology and electronics. Advantest fell 3.6%, Kioxia Holdings lost 2.8% and Panasonic Holdings dropped 4%.

The dollar traded around 159.13 yen, offering some support to Japanese exporters, but that was not enough to counter semiconductor weakness.

The Nikkei has now fallen for three straight sessions as investors reduce exposure to AI-linked names ahead of Nvidia’s results.

IG market analyst Fabien Yip told The Edge Malaysia that Nvidia has a history of meeting headline expectations, but investors are increasingly focused on whether its growth rate is sustainable and whether financing structures across the AI ecosystem could become a concern.

Nvidia and Jackson Hole keep Asia defensive

The caution extended across the region. MSCI’s broadest Asia-Pacific index outside Japan fell about 0.5%.

Nasdaq futures slipped 0.08%, S&P 500 futures were roughly flat and EUROSTOXX 50 futures edged 0.05% lower.

Oil provided some relief. Brent eased to around $92.08 a barrel after falling more than 2% on Monday, while WTI hovered near $85.09 after Washington’s threatened sanctions escalation against Iran produced fewer immediate penalties than markets had feared.

US Treasury yields also eased from recent highs amid reports that the Treasury could use its cash balance to support larger debt buybacks. Attention now shifts to Fed Chair Kevin Warsh’s Jackson Hole speech on Friday.

Standard Chartered analysts said that clearer guidance on how long the Fed is prepared to hold rates steady could reduce some policy uncertainty.