On Monday, the selloff in Asian technology stocks continued. South Korean shares tumbled sharply in early trading, triggering a 20-minute temporary trading halt.

The benchmark KOSPI index fell as much as 8.8%, with shares of semiconductor giants Samsung Electronics and SK Hynix both plunging more than 10%.

These two companies together account for roughly 40% of the index's weighting. By the afternoon session, their losses had moderated, helping the KOSPI to pare its decline to under 5%.

In Japan, the tech-heavy Nikkei 225 index fell 3.9%, while the broader Topix index declined 2.6%.

The selloff across Asia followed a 4.2% drop in the Nasdaq Composite on Friday, its worst single-day performance since April of last year. U.S. semiconductor stocks were hit hard by intensifying concerns over excessive valuations for artificial intelligence-related shares.

The blue-chip benchmark, the S&P 500, also fell 2.6% on Friday, ending a nine-week winning streak.

Other Asian markets, with lower weightings of listed semiconductor firms, saw relatively limited declines.

In response to the heightened market volatility, the Korea Exchange held an emergency meeting on Monday to discuss stabilization measures. Prior to the selloff that began late last week, the KOSPI had more than doubled its year-to-date gains.

Foreign investors net sold a record 100 billion dollars worth of South Korean stocks just last week, putting significant pressure on the Korean won, which fell to its lowest level against the U.S. dollar since March 2009.

The South Korean government announced a series of measures on Sunday to stabilize the currency, vowing to crack down on speculative trading.

Analysts at Nomura noted that the chip sector has recently been weighed down by multiple factors. These include Broadcom's quarterly results missing expectations, U.S. clients urging the White House for policies to ease memory chip shortages, and Nvidia scaling back some production capacity for its next-generation Vera Rubin platform.

However, in a research report released on Monday, the firm emphasized that the market may be misinterpreting the situation, and that various news items related to memory chips do not signal weakening demand. Analysts added, "On the contrary, these developments further confirm that the current memory chip supply shortage is a structural issue."

The KOSPI's sharp year-to-date rally moderated somewhat after South Korean President Lee Jae-myung stated that the country's stock valuations remained low.

On Monday, following a meeting in Seoul with SK Group Chairman Chey Tae-won, Nvidia CEO Jensen Huang suggested that the significant decline in tech stocks actually presented a buying opportunity.

He stated, "There's no need to worry about volatility in the stock market. Being able to enter at a discount now is actually a good thing."

Japan's two major stock indices had just hit record highs last week. The Nikkei/Topix ratio, which measures the concentration of capital in tech stocks, also climbed to a recent peak, reflecting market enthusiasm for the technology sector far exceeding that for other industries.

A Tokyo-based trader commented, "The market was clearly overheated last week. Profit-taking in early trading today was entirely within expectations. A large amount of retail money participated in this rally, and retail investors are often the first to panic-sell."

Stocks like TDK and Kioxia have been typical targets for foreign buying of Japanese AI-related shares this year. On Monday, their shares fell 9.3% and 8.5%, respectively.

SoftBank Group, which briefly surpassed Toyota last week to become Japan's most valuable company, saw its shares fall 7.5%, putting its market capitalization once again below that of the automotive giant.