Asian stock markets experienced significant declines on Friday, largely driven by a substantial drop in Japan’s Nikkei 225 index. The index plummeted 5.8%, closing below the 63,000 threshold, as investors engaged in heavy selling of technology and artificial intelligence-related stocks. Taiwan’s market also saw a substantial loss of over 5%, while Hong Kong’s Hang Seng index decreased by 2%, and China’s Shanghai Composite fell by 1.6%. Australia’s S&P/ASX 200 registered a 0.7% decline.
The pressure on technology stocks has been mounting in recent weeks, with concerns growing over the rapid rise in valuations within the artificial intelligence sector. Investors are increasingly wary about whether the demand for advanced chips and memory products will remain robust if AI technologies fail to deliver the anticipated profits and productivity improvements.
In the United States, the tech-heavy Nasdaq Composite fell 1.5% on Thursday, primarily due to losses among major chipmakers. Nvidia saw a decline of 2.4%, while other industry players such as Micron Technology, SanDisk, and Western Digital also recorded significant downturns.
Amid these market developments, oil prices rose as tensions in the Middle East escalated, sparking fears of potential disruptions to global energy supplies through the critical Strait of Hormuz. Brent crude increased by 1.1%, reaching $85.13 per barrel, while the US benchmark crude rose 1.3%, hitting $79.95 per barrel.