South Korea's benchmark Kospi index fell by up to 3.2%, breaking a three-day winning streak, as a sharp decline in US chip stocks overnight weighed on sentiment.

The major drags on the index were heavyweight stocks including SK Hynix, Samsung Electronics, and SK Square.

Foreign investors continued to sell Kospi components, while retail investors bought against the trend, and domestic funds also sold their holdings.

The small-cap Kosdaq index fell by up to 3%.

South Korean stocks underperformed the MSCI Asia Pacific Index, which fell by a maximum of 1.1%.