Analysts and investors react to AI market rout
QQQ•The Nasdaq fell 5.5% on Thursday, its biggest drop since the 2025 tariff-triggered selloff, while South Korea’s KOSPI dropped 6% and Taiwan’s benchmark fell 4.5% on Friday. Market participants cited concerns about AI valuations, potential data centre constraints and forced selling.
1. Markets sell off
The Nasdaq fell 5.5% on Thursday, its biggest drop since the tariff-triggered “Liberation Day” rout in 2025. On Friday in Asia, South Korea’s KOSPI slumped 6% and Taiwan’s benchmark slid 4.5%, marking its largest weekly fall in more than two decades.
2. Investors weigh AI risks
Market participants said concerns about AI spending, valuations and possible limits on data centre development were contributing to the selloff. Some also pointed to margin calls and forced liquidations as factors that could intensify the decline.
3. Outlook remains uncertain
Several participants said it was too early to determine whether markets had bottomed. Shane Oliver of AMP said that if the economic outlook remained unaffected, the decline would probably be more of a correction than a bear market.
