SEOUL, July 29 (Yonhap) -- Seoul shares plunged by nearly 6 percent Wednesday following a nearly 11 percent crash the previous session as investors dumped semiconductor stocks amid growing skepticism over whether massive spending on artificial intelligence (AI) will generate sufficient returns.

The local currency strengthened against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) lost 360.42 points, or 5.98 percent, to close at 5,663.24, after plunging to an intraday low of 5,262.77.

After opening 1.09 percent higher, the KOSPI reversed course and tumbled by up to nearly 12 percent in afternoon trading.

At 12:31 p.m., the Korea Exchange activated a marketwide circuit breaker, halting trading in KOSPI-listed stocks for 20 minutes.

The broad-based sell-off came amid growing skepticism over whether hefty AI-related investments by major technology companies could generate sufficient returns to justify their lofty market valuations.

kyongae.choi@yna.co.kr

(END)

• (LEAD) S. Korea, U.S. open shipbuilding partnership center to advance MASGA initiative
• Nam Joo-hyuk to star in new Disney+ crime thriller 'Code'
• (3rd LD) SK Group chairman ordered to pay 944 bln won in asset division to ex-wife
• Trump threatens 'substantial' Section 301 tariffs on EU after Google fine

• Lee says emergence of AI era offers S. Korea new opportunity

• S. Korea formally completes development of homegrown KF-21 fighter jet

• (LEAD) Tremor of Japan earthquake felt in parts of S. Korea: authorities
• KRX activates sell-side sidecar for KOSPI on sharp decline
• (2nd LD) Seoul shares crash over 10 pct on heavy tech selloff amid AI skepticism
• Bourse operator issues circuit breaker for KOSPI on sharp fall