South Korea's stock market resumed its decline on Monday, as DeepSeek released an updated version of its AI model over the weekend, while concerns over artificial intelligence financing continued to linger.

The benchmark Kospi index fell as much as 3.2% at one point, with chipmakers Samsung Electronics and SK Hynix each dropping more than 4% before paring some of those losses.

In Japan, the technology-heavy Nikkei 225 index declined about 2%, with chip equipment maker Advantest leading the drop.

US chip stocks fell on Friday for an eighth consecutive trading session, as investor worries mounted over soaring costs for AI infrastructure buildouts.

At the same time, DeepSeek released an updated version of its AI model over the weekend, describing the new version as faster and more streamlined, which sparked concerns that less memory may be required.

"There are too many uncertainties right now to tell whether the South Korean stock market has bottomed out," said Kang DaeKwun, chief executive of Life Asset Management, noting that uncertainty over funding for US companies' AI projects is the main cause of market turbulence. "If US companies don't keep investing, South Korean companies can't make a profit."

The Kospi index has just recorded its worst weekly performance since October 2008. Even so, after massive spending in the AI sector drove memory prices to record highs, the South Korean benchmark index is still up more than 30% so far this year.