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View all search resultsTech sell-off deepens as US inflation sparks AI jitters
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A man checks his phone in front of an electronic quotation board displaying the Nikkei Stock Average on the Tokyo Stock Exchange in Tokyo on Oct. 15, 2026. (AFP/Yuichi Yamazaki)
A
sian stocks plunged Thursday as technology firms suffered another rout after forecast-topping US inflation data fueled expectations the Federal Reserve would further increase interest rates.
European stock markets were more resilient, benefiting from their lower exposure to the tech sector, as well as falling oil prices and government bond yields.
Seoul and Tokyo bore the brunt of the selling as traders bailed out of chipmakers, tracking sharp losses on Wall Street.
"The tech sell-off has continued with pace, exacerbated by US inflation data which increased expectations for US interest rate hikes this month," said Dan Coatsworth, head of markets at AJ Bell.
"US Treasury bond yields fell, suggesting that investors are moving into supposed lower-risk assets," he added.
Markets, already struggling with concerns about the outlook for the AI investment boom, were stung after data showed the US consumer price index jumped more than expected to 3.7 percent in September.
The inflation figures put pressure on the Fed to raise rates at least once more following September's hike, with the bank's decision due on Oct. 28, a week before the US midterm elections.
Tech firms rely heavily on borrowing to fund their huge AI investments, meaning they are particularly sensitive to higher interest rates.
In Europe, stock markets in London and Paris rose while Frankfurt fell.
Saxo UK investor strategist Neil Wilson pointed to "worries about the AI buildout, bubbly valuations, lower-than-expected earnings growth at leading US frontier labs, Chinese competition" as additional factors behind the tech selling.
Seoul's Kospi dived more than 8 percent – leading to a brief trading halt – before slightly paring the losses, with semiconductor firm SK hynix sinking more than 11 percent and Samsung more than 9 percent.
Tokyo shed close to 6 percent, driven by sharp falls for Advantest, Kioxia and investment titan SoftBank.
Taipei lost more than 3 percent as market heavyweight TSMC gave up 2 percent even after it announced a sixth straight run of record quarterly profit, fueled by demand for AI hardware.
