Asian stock markets, particularly in South Korea and Japan, experienced significant losses in July due to a sharp sell-off in artificial intelligence (AI) stocks. The benchmark KOSPI in Seoul fell 4.52 percent to 6,299.88, driven by a decline in large-cap tech shares. Several large multi-strategy hedge funds in Asia reported their largest monthly drawdowns of the year, with some funds experiencing losses between 3% and 9% as AI stock values eroded earlier gains.
South Korean stocks extended their losses late Thursday morning, with the benchmark KOSPI falling 4.52 percent to 6,299.88. This decline was primarily driven by a sell-off in large-cap technology shares. The broader Asian market also felt the impact, as several large multi-strategy hedge funds in the region experienced their biggest monthly losses of the year in July. A sharp sell-off in artificial intelligence (AI) stocks across Japan, South Korea, and China erased earlier gains. Some of these funds saw their values drop between 3% and 9% as a result of the AI stock market downturn. The slump in AI stocks has led to significant financial repercussions for hedge funds that had previously benefited from gains in this sector.