Asia stocks crumble after AI rout rocks US markets
SMH•Asia’s tech-heavy markets fell sharply after US stocks suffered their steepest drop since the tariff-triggered selloff a year and a half ago. South Korea’s KOSPI fell more than 8%, Japan’s Nikkei dropped 5%, and the Philadelphia Semiconductor Index slumped 12.2%.
1. Asian markets plunge
South Korea’s KOSPI fell more than 8% on Friday, triggering a 20-minute trading halt, while Japan’s Nikkei was down 5%. The declines followed a sharp US selloff as concerns about regulatory scrutiny and a possible slowdown in AI investment weighed on technology shares.
2. AI concerns spread
The Nasdaq fell 5.5%, and $3 trillion was wiped off S&P 500 companies. The Philadelphia Semiconductor Index dropped 12.2% overnight, while the Nasdaq has fallen 12% from its record high close a month ago. Investors are concerned about returns on large AI investments and potential opposition to data-centre construction.
3. Bonds find favour
Bonds were poised to gain in Asia, and the US dollar slipped against the yen and Swiss franc. Market participants see chipmakers and data-centre equipment suppliers in South Korea, Taiwan and Japan as especially vulnerable.
