South Korean Shares Soar as AI Frenzy Sparks Global Chip Stock Recovery

South Korean equities experienced a massive rebound this week, with the Kospi index surging after a three-day rout that had wiped hundreds of billions of dollars from the market. The recovery was led by a rally in semiconductor stocks, driven by renewed optimism surrounding the global AI boom. Investor sentiment was further bolstered by the blockbuster market debut of a major Chinese chipmaker, whose shares skyrocketed nearly 470% on their first day of trading, underscoring the insatiable demand for high-end processing hardware.

Despite the tech-led rally, the broader economic picture remains complex. Fast-fashion giant Shein reported a $99 million loss, citing the heavy impact of U.S. tariffs on its sales as it prepares for a Hong Kong IPO. Meanwhile, Johnson & Johnson has moved to settle its long-standing baby powder litigation with a $5.5 billion offer, aiming to clear a significant legal hurdle that has weighed on its stock for years. The divergence between the soaring chip sector and struggling consumer firms highlights the uneven nature of the current global economic recovery.