Tech stocks lead rout in Asia after US inflation fuels rate hike bets
Chip-related counters in South Korea and Japan account for the bulk of the heavy selling.
On October 15, Asian stocks plunged as technology companies faced another significant decline, following US inflation data that exceeded forecasts and raised the possibility of higher interest rates from the Federal Reserve. Both Seoul and Tokyo were hit the hardest by the selling, with traders exiting once-powerful chipmakers. The US consumer price index rose to 3.7% in September, up sharply from the prior month and above the 3.6% forecast, driven by soaring energy costs due to Iran's conflict with Tehran.
This prompted bets on a second rate hike in 2026, with the chance of a 25-basis-point increase in October at 37.1% according to CME Group’s FedWatch tool. Neil Wilson of Saxo Markets noted that the data dealt a blow to the Fed's hopes of pausing rate hikes this month, while Pepperstone's Chris Weston said it reinforced the expectation of "higher-for-longer" rates.
Tech firms led the losses, tracking their counterparts in New York, as SK Hynix and Samsung both fell more than 9%, leading the Kospi to briefly plunge over 8% before recovering. In Tokyo, the Nikkei 225 dropped nearly 5%, with Kioxia and Advantest both falling more than 12%. Despite record quarterly profits for chipmaker TSMC, it still saw losses as tech stocks continued their downward trend following a summer rout.
Written by urgent.news from Straits Times Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
