Tech leads losses as Asian stocks track Wall St selloff
Higher yields raise hyperscalers' borrowing costs, raising concerns over capital spending and AI infrastructure companies.
Technology stocks experienced a significant decline on Wednesday, following a surge in bond yields, rising oil prices, persistent inflation, and dwindling hopes for a deal to reopen the Strait of Hormuz. This sell-off mirrored the losses on Wall Street, where firms heavily invested in AI and chips were heavily affected, ending a recent recovery in the sector.
The crisis in the Middle East, with US and Iranian officials remaining entrenched in their positions, has led to crude prices climbing higher due to the Strait of Hormuz potentially remaining closed. This has heightened inflation expectations and sent US government debt costs soaring, with the yield on a 30-year US Treasury reaching its highest level since June 2007, prior to the global financial crisis.
US tech and chip giants such as Nvidia, Intel, Micron, and Broadcom faced heavy losses, causing the Nasdaq and S&P 500 to drop. In Asia, Seoul's Kospi, a symbol of the AI tech rally, plummeted more than five percent, while chip leaders SK hynix and Samsung fell at least seven percent. Tokyo also saw a decline of over two percent, with Kioxia down around 10% and investment giant SoftBank not faring much better.
Other markets like Shanghai, Taipei, and Manila also saw losses exceeding one percent. Analysts have expressed concerns about the impact of higher yields on capital spending and AI infrastructure companies.
Written by urgent.news from Free Malaysia Today's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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- Tech leads losses as Asian stocks track Wall St selloff freemalaysiatoday.com
