Asian stock markets took a significant hit on Friday, with Japan’s Nikkei 225 index leading the downturn due to a pronounced sell-off in technology and AI-related stocks that left investors on edge. The Nikkei plummeted 5.8%, falling short of the 63,000 threshold. Taiwan’s market also faced a severe drop, losing over 5%, while Hong Kong’s Hang Seng index decreased by 2%. Meanwhile, China’s Shanghai Composite saw a 1.6% reduction, and Australia’s S&P/ASX 200 fell by 0.7%.
Technology stocks have been under increasing scrutiny as concerns mount over whether valuations within the AI sector have escalated too swiftly. There’s a growing sense of unease amongst investors regarding the sustainability of demand for advanced chips and memory products, especially if artificial intelligence does not yield the anticipated profits and efficiency improvements.
This apprehension extended to the United States, where the Nasdaq Composite dipped by 1.5% on Thursday. This decline was driven by losses in prominent chipmakers, with Nvidia’s shares dropping 2.4%. Micron Technology, SanDisk, and Western Digital similarly experienced notable declines.
Amidst the turbulence in stock markets, oil prices saw an upward trend as escalating tensions in the Middle East raised alarms about potential disruptions to global energy shipments through the Strait of Hormuz. Brent crude increased by 1.1%, reaching $85.13 per barrel, while the US benchmark crude rose 1.3%, hitting $79.95 per barrel.
