Asian tech stocks tumble as AI spending worries spread
South Korea's KOSPI fell 5.20% and Japan's Nikkei 225 dropped 2.55% on Friday after disappointing earnings from major US tech companies fuelled concerns about the pace of AI-related investment.
The KOSPI slid to 5,630, with Samsung shares down 5.70% at one point and SK Hynix losing 1.60%, even though SK Hynix had reported record quarterly sales of 104.6 trillion won earlier in the week.
In Japan, the Nikkei 225 closed at 63,020. The move came as the Bank of Japan (BoJ) kept its short-term interest rate unchanged at 1.25% after a two-day policy meeting, a decision in line with market expectations. The BoJ also said underlying inflation was “generally consistent” with its 2% target, the first time it has made that judgment since adopting the target in 2013.
Taiwan’s Taiex dropped 2.42% to 45,255, with investors citing higher borrowing costs, heavy AI-related spending and some earnings that missed expectations. Mainland China’s Shanghai Composite eased 0.30% to 3,640 and the Shenzhen index fell 0.60% to 11,075, while Hong Kong’s Hang Seng Index bucked the trend, rising 1.70% to 23,345.
Across the region, the selling was concentrated in technology shares most exposed to the AI investment cycle, after results from large US tech firms raised doubts among investors about near-term returns on that spending.
Why it matters for markets: Renewed doubts about AI spending returns can weigh on technology-heavy indices such as the Nikkei 225, KOSPI and, by extension, the Nasdaq 100, while the BoJ’s steady policy stance and inflation assessment keep USD/JPY sensitive to future rate-hike signals from Tokyo.
Sources: Investing.com (economy); Investing.com (economy); FXStreet