Asian stock markets experienced significant declines on Friday, with Japan’s Nikkei 225 index suffering a notable drop amid intense selling pressure on technology and artificial intelligence-related stocks. The Nikkei fell by 5.8%, closing below the 63,000 threshold, which led the downturn in the region. Taiwan’s stock market also faced a steep decline, losing over 5%, while Hong Kong’s Hang Seng index and China’s Shanghai Composite decreased by 2% and 1.6%, respectively. Australia’s S&P/ASX 200 experienced a smaller decline, slipping 0.7%.
The recent turbulence in technology stocks stems from growing concerns that valuations in the artificial intelligence sector may have escalated too rapidly. Investors are increasingly skeptical about whether the demand for advanced chips and memory products will remain robust if AI technologies do not deliver the anticipated profits and productivity enhancements. This skepticism has contributed to the downward pressure on stock prices across the technology sector.
In the United States, technology stocks were not spared from the global downturn. On Thursday, the Nasdaq Composite dropped by 1.5% as major chipmakers experienced losses. Nvidia’s stock fell by 2.4%, while other key players in the industry, including Micron Technology, SanDisk, and Western Digital, also reported significant declines.
Amidst the turmoil in technology markets, oil prices saw an upward movement, driven by growing tensions in the Middle East. The potential for disruptions to global energy supplies, particularly through the Strait of Hormuz, has heightened concerns. As a result, Brent crude prices rose by 1.1%, reaching $85.13 per barrel, while the US benchmark crude increased by 1.3% to $79.95 per barrel.