A tech stock rout that began overnight in the United States has persisted in Asian trading. Market authorities in South Korea paused trading on Friday as prices plunged across the region. Global markets have been rattled by a sharp fall in the trading price of tech stocks, which is driven by fears that the Democrats’ victory in the US midterm elections will increase regulatory scrutiny of AI and slow the country’s data centre build-out.
Japan’s Nikkei index slumped 6 percent, its deepest one-day drop since April 2025. Indices in South Korea and Taiwan plunged more than 8 percent after the opening bell, before cutting losses as authorities scrambled to stem the selling. Wall Street’s volatility “fear gauge” soared overnight on Thursday and the tech-focused Nasdaq sank 5.5 percent, wiping $3 trillion off S&P 500 firms, as investors fretted that the Democrats could put the brakes on the AI boom being encouraged by President Donald Trump.
We saw that the AI sell-off continues here across many countries,” Al Jazeera’s Katrina Yu reported from Beijing. Analysts say the political jitters are hitting an AI trade already on shaky footing due to worries about returns on massive spending on related infrastructure. Now that backbone has snapped.
Can AI bull markets elsewhere hold up on their own?” Markets cut some of their losses by the time Asian markets closed, as authorities worked to stem the panic. Trading on South Korea’s Kospi market was temporarily halted amid the sharp slide. Finance Minister Lee Hyoung-il also eased rules on retail investors’ leveraged investments.
In China, state entities stepped in to buy up equities in a bid to stabilise the market, said Al Jazeera’s Yu. The Taiwan stock market closed down 4.5 percent, recovering somewhat from its early morning slump. For the week, the index clocked a 12.2 percent decline, its biggest since 1991, LSEG data showed.
The government of the island state, a key producer of chips, sought to talk up the prospects for the sector. Demand for emerging technologies like AI, high-performance computing and cloud services is expected to keep expanding, driving demand for tech companies, the economy ministry said in a statement issued on Friday. Korean AI chipmakers Samsung Electronics and SK Hynix fell nearly 6 percent and 9.4 percent respectively, cutting steep losses from earlier.
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