Asian Equities Tumble as AI Selloff Deepens

By Sherry Qin

Asian equities plunged early Friday, tracking the selloff on Wall Street overnight, as a postelection rout of artificial-intelligence stocks deepened amid worries over a slowdown in the AI data-center build-out.

"Growing fears about the sustainability of the AI buildout in the context of the major shift in U.S. politics have led to another bruising day for tech stocks," said Joe Maher, markets economist at Capital Economics.

The Nasdaq plunged 5.5%, marking its worst one-day drop since April 2025, while the Philadelphia Semiconductor Index slid 12%.

The semiconductor sector is facing a severe sentiment shift: once the biggest engine of the AI trade, it has now turned into the market's punching bag. Nvidia lost 9.3% and Intel slid 10% on Thursday.

"Opposition to data-center expansion has gained political momentum, creating headwinds for data-center operators, power equipment suppliers and semiconductor companies, whose growth expectations depend heavily on rapid infrastructure expansion," said Charu Chanana, chief investment strategist at Saxo Markets.

The rout in semiconductor stocks extended to Asia. SK Hynix tumbled 12% and Samsung Electronics shed 10%. The Korean tech heavyweights sent the benchmark Kospi down over 8% and triggered a 20-minute trading halt. Japan's Kioxia Holdings fell 11% and Tokyo Electron declined 7.5%, sending the Nikkei Stock Average down 5.5%.

In Taiwan, Taiwan Semiconductor Manufacturing Co. fell 9.15% and MediaTek was down 10%. Taiwan's Taiex tumbled 8.6%, on track for its largest daily percentage loss since April 2025.

The brutal losses come as sentiment toward the AI trade has already grown more fragile. The Democratic election win could plausibly become the catalyst that leads to a more long-lasting unwinding of the AI equity boom, Capital Economics' Maher added.

Oil rose as traders reassessed the prospect of an end to the Iran war. The sharp drop in oil prices right after the election results was likely overdone, ANZ Research analysts said in a note.

"The reality of the situation hit home," they said, adding that Iran still maintains control of the Strait of Hormuz and is unlikely to relinquish that control.

Front-month West Texas Intermediate futures rose 0.9% at $91.29 a barrel and front-month Brent futures gained 1.0% to $99.24 a barrel.

Write to Sherry Qin at sherry.qin@wsj.com

(END) Dow Jones Newswires

November 05, 2026 20:45 ET (01:45 GMT)