HONG KONG — An intensifying rout of tech stocks hit global markets Friday, with a surge of red tickers spreading from Wall Street to Asia and Europe after the blue wave of the U.S. midterm elections fueled fears over AI development. The steep losses in Asia — Japan’s Nikkei suffered its worst week since 2020 — came after a dramatic plunge in U.S. tech stocks following the success of anti-AI candidates, which deepened concerns about the durability of the AI boom. Some $2.3 billion in market value was wiped off the tech-focused Nasdaq 100, which dropped 6.3% on Thursday.
Another $2.8 trillion was erased from the S&P 500’s market value as it fell 4.4% — their worst day in 18 months, when President Donald Trump’s global tariffs rocked markets. U.S. futures were mixed early Friday, but European shares also opened lower after the dramatic selloff continued in Asia. South Korea’s Kospi index tumbled more than 8%, triggering a temporary market-wide trading halt.
There, AI data center memory suppliers Samsung and SK Hynix plunged more than 10% in the early hours, before recovering some of their losses. Japan’s Nikkei 225 index fell as much as 6%, entering bear-market territory. In Taiwan, home to some of the most critical AI companies, including chip supplier TSMC, the benchmark TAIEX index dropped 9%.
London’s FTSE 100 index fell by 1.6% on Friday open, while the French and German indices, CAC40 and DAX, took similar hits. AI infrastructure cycle,” Charu Chanana, Chief Investment Strategist at Singapore-based SAXO Markets, told NBC News in emailed comments. The companies in Taiwan, South Korea and Japan are “clearly highly linked to the global AI capex cycle and hence I am not surprised to see the magnitude of correction today following the sharp correction in the U.S.,” Tai Hui, J.P.
Morgan’s APAC Chief Market Strategist, told NBC News in emailed comments. The plunge came after the stunning midterm results that will see the rise of a crop of anti-AI and anti-data center politicians, including Gov.-elect Gina Hinojosa in Texas, the largest data center market in the country. A Democratic Congress could tighten scrutiny of the industry, including AI infrastructure projects, which could cause delays and additional costs, adding to worries investors have about the profitability of these investments.
Recent months have been nothing short of a rollercoaster for Asian investors, who saw their paper fortunes grow by magnitudes in June during the AI stock boom, but have been suffering from a brutal recent sell-off.
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