South Korean stocks opened sharply lower on Tuesday, extending losses from the previous session as investor sentiment was weighed down by a selloff in U.S. tech shares overnight.

Market participants adopted a cautious stance ahead of key events including earnings reports from U.S. chipmaking giants such as Nvidia, while also keeping an eye on Middle East geopolitical tensions.

The benchmark Korea Composite Stock Price Index (KOSPI) fell 2.4% at the open and losses subsequently widened, with the index now down more than 4% at the time of writing. In the prior session, the market had already dropped over 3% as concerns resurfaced over the profitability of artificial intelligence-related investments, hitting shares of companies like Samsung Electronics.

Investors are now balancing escalating geopolitical risks in the Middle East against a busy week of U.S. economic data releases and corporate earnings. Federal Reserve Governor Kevin Warsh is scheduled to speak on Friday at the annual Jackson Hole symposium in Wyoming, with his remarks expected to offer clues on the central bank's monetary policy direction amid persistent inflation.

Technology stocks led the decline. Samsung Electronics fell 4.28%, while chipmaking rival SK Hynix tumbled 6.46%.

Among other notable movers, leading automaker Hyundai Motor slipped 1.57%, and defense giant Hanwha Aerospace declined 0.72%. On the upside, Samyang Foods edged up 0.2% and Korea Zinc gained 2.31%.