Asian technology stocks fell sharply on Friday after a steep sell-off on Wall Street overnight, according to CNBC. The tech-heavy Nasdaq Composite sank 5.5% and closed more than 10% below its recent peak, pushing it into correction territory. The Philadelphia Semiconductor Index plunged 12.2%.
South Korean chipmaker SK Hynix fell over 8%, and Samsung Electronics shed 7%. In Japan, chip-testing equipment maker Advantest dropped 12.2%, and SoftBank Group tumbled 11.6%. In Taiwan, contract chipmaker TSMC slid 9.6%, and Foxconn fell 9.4%. China's STAR Market and ChiNext Artificial Intelligence Index each fell more than 4%.
CNBC reports that investors worried Democrats' sweeping victory in the U.S. midterm elections could lead to tighter restrictions on data-center development. Such limits could slow demand for AI chips and related infrastructure. The report also cites mounting concerns over the sustainability of the AI investment boom and returns on massive data-center spending.
Timothy Moe, chief Asia Pacific equity strategist at Goldman Sachs, told CNBC that investors unwinding positions, stop-loss selling and heightened volatility have worsened the Asian sell-off. He said potential political opposition to U.S. data center construction may affect demand and profits for Asian AI hardware suppliers. "If there's concern about the speed and magnitude of buildout in the U.S., then obviously that's going to put all that into question," he said. "The market's tendency is always to shoot first and ask questions later. I think that's exactly what's happening now."