Seoul: South Korean stocks were trading sharply lower late Thursday morning as valuation concerns for the artificial intelligence (AI) sector persisted. The benchmark Korea Composite Stock Price Index (KOSPI) fell 38.92 points, or 0.96 percent, to 4,017.49 as of 11:20 a.m.

According to Yonhap News Agency, U.S. stocks closed lower overnight on reports that a major funding partner of Oracle decided to pull out from the company's data center project. AI-related stocks came under selling pressure, with shares of Oracle tumbling by more than 5 percent. In Seoul, most large-cap shares were trading lower.

Market bellwether Samsung Electronics dipped 0.83 percent, while its chipmaking rival SK hynix added 1.09 percent. Shares of Samsung Electronics have fallen close to 3 percent over the past month, amid continued woes regarding the AI sector. Defense giant Hanwha Aerospace fell 0.46 percent, top car maker Hyundai Motor slid 1.4 percent, while portal operator Naver added 0.32 percent. Battery maker LG Energy Solution nose-dived by 6.74 percent on the cancellation of a massive supply deal with Ford.

The local currency was quoted at 1,474.6 won against the greenback, up 5.2 won from the previous session's close. Amid the won's continued weakness, financial authorities earlier in the day reaffirmed their commitment to stem volatility in the currency market.