SOUTH KOREA STOCKS REBOUND 5% AMID AI VOLATILITY

The rally marks a significant swing in market sentiment after two days of heavy selling pressure. The volatility reflects broader investor anxiety about whether current AI valuations can be justified by actual economic returns. South Korean markets have been particularly sensitive to AI-related developments, given the country's substantial semiconductor and technology sector exposure. Major companies like Samsung and SK Hynix play crucial roles in the global chip supply chain that powers AI infrastructure. The sharp moves underscore skittish investor behavior as scrutiny intensifies around the AI sector's fundamentals. Recent weeks have seen multiple bouts of profit-taking following strong gains, creating an environment prone to rapid reversals. Analysts point to a broader pattern of AI-driven rallies followed by corrections as markets attempt to price in long-term adoption and profitability. The 5% rebound suggests some investors view recent weakness as a buying opportunity, though the underlying concerns about sustainability persist.