On a Thursday in mid-October, the Asian markets fell hard as the enthusiasm that had carried technology shares to record heights came up against an unwelcome reminder of the economy's stubborn costs. South Korea's Kospi and Japan's Nikkei dropped sharply, led by the chipmakers whose fortunes have been bound most tightly to the artificial intelligence boom. The trigger lay across the Pacific, where a higher-than-expected inflation reading had unsettled Wall Street the day before. Whether this becomes a passing pause or a longer reckoning will depend on what the coming days bring from American m
A deepened tech sell-off drags Asian stocks lower as markets in South Korea and Japan sink
The steepest drops landed on the companies closest to the AI enthusiasm.
Mark
Why did a U.S. inflation number hit Seoul and Tokyo so hard?
Mimi
Because the inflation figure, 3.7% for September, came in above what economists expected, and it landed on top of stocks that were already priced for a lot of AI optimism. The chipmakers took the worst of it.
Mark
How bad was it in the individual companies?
Mimi
Samsung fell 11.4% and SK Hynix 12% in South Korea. In Japan, Kioxia lost 13.1%, SoftBank 9.4%, and Tokyo Electron 7.8%.
Luke
Those figures are solid. But I'd keep the cause in perspective. The report links the sell-off to the inflation data, and that is the reporting's framing, not something it proves. Markets rarely move for one reason.
Mark
Is there a bigger picture beyond one day?
Mimi
The Kospi is down more than 16% over a month, and it's far below the 9,000 level it reached in June. So this deepens a slide that was already underway.
Luke
Worth noting the report is inconsistent on U.S. futures. One line says mixed, another says lower. I wouldn't lean on either.
Mark
And the bond market details?
Luke
The passage is scrambled. I can make out a Treasury yield possibly above 5%, but I wouldn't state it as fact.
Mimi
Right. The clear story is the Asian index moves and the Wall Street closes. What comes next is still unknown.
Le Pouls
- South Korea's Kospi plunged 7.9%, erasing ground it had gained in a matter of weeks and sliding more than 16% over the past month.
- Samsung Electronics fell 11.4% and SK Hynix plunged 12%, leaving the country's chip giants at the center of the rout.
- In Japan, the Nikkei tumbled 5%, with Kioxia down 13.1% and SoftBank, an OpenAI investor, down 9.4%.
- U.S. inflation came in hotter than expected at 3.7%, pulling the Nasdaq down 1.9% and leaving investors bracing for what rising rates might mean for AI bets.
On a Thursday in mid-October, the Asian markets fell hard as the enthusiasm that had carried technology shares to record heights came up against an unwelcome reminder of the economy's stubborn costs. South Korea's Kospi and Japan's Nikkei dropped sharply, led by the chipmakers whose fortunes have been bound most tightly to the artificial intelligence boom. The trigger lay across the Pacific, where a higher-than-expected inflation reading had unsettled Wall Street the day before. Whether this becomes a passing pause or a longer reckoning will depend on what the coming days bring from American markets and from the people who set interest rates.
Asian markets opened Thursday under heavy pressure, and technology stocks sat squarely at the heart of the storm. South Korea's Kospi index fell 7.9% to close at 5,532.74, while Japan's Nikkei 225 dropped 5% to 64,340.84.
The trouble began the day before on Wall Street. Consumer prices in the United States had risen 3.7% over the year through September, more than economists had anticipated. The S&P 500 slipped 1.1% and the Nasdaq sank 1.9% as artificial intelligence stocks were hit hardest.
In Seoul, the damage fell mainly on chipmakers. Samsung Electronics slid 11.4% and SK Hynix plunged 12%. The Kospi has now lost more than 16% in a month, a long way below the 9,000 level it passed in June, when optimism about the global AI boom pushed it to an all-time high.
Tokyo followed a similar path. SoftBank Group, which has invested in OpenAI, lost 9.4%, Tokyo Electron fell 7.8%, and Kioxia Holdings dropped 13.1%.
The picture is clear enough: investors had priced in continued enthusiasm for AI, and inflation running hotter than forecast caught them unprepared. Whether this proves a brief pause or the start of a deeper correction will depend on how Wall Street opens and on where inflation and interest rates head next.
Asian markets opened Thursday under heavy selling, with technology stocks at the center of it. South Korea's benchmark Kospi index lost 7.9% to close at 5,532.74, and Japan's Nikkei 225 tumbled 5% to 64,340.84.
The selling followed a down day on Wall Street. On Wednesday, the U.S. reported that consumer prices rose 3.7% in September from a year earlier, a bigger increase than economists had expected. The S&P 500 slid 1.1%, the Dow Jones Industrial Average dipped 0.1%, and the technology-heavy Nasdaq composite slipped 1.9% as stocks tied to artificial intelligence fell. The wire report described U.S. equity futures as mixed on Thursday, though the AP's own lede said they were trading lower, so that detail is unsettled.
In South Korea, the damage was concentrated in the country's chipmakers. Samsung Electronics slid 11.4%, and memory chipmaker SK Hynix plunged 12%. The Kospi has now fallen more than 16% over the past month. It sits well below the 9,000 mark it crossed in June, when it hit an all-time high driven by optimism over the global AI frenzy.
Japan's losses ran along similar lines. SoftBank Group, an investor in OpenAI, lost 9.4%. Tokyo Electron, which makes chip equipment, dropped 7.8%, and memory chipmaker Kioxia Holdings lost 13.1%.
The source text also carries a section on Wall Street's individual movers and on bond markets, but that passage is garbled and mostly unreadable. A few figures can be pieced together: the 10-year U.S. Treasury yield appears to have risen above 5% after the inflation report, and chipmakers such as AMD, Broadcom and Micron seem to have been among the decliners. Because the text is scrambled, those details should be treated as tentative rather than confirmed.
What the confirmed numbers show is a market that had been priced for continued enthusiasm about AI and was caught off guard by inflation running hotter than forecast. The steepest drops landed on memory and chip-equipment makers, the companies most closely tied to that enthusiasm. Whether Thursday marks a pause or the start of a longer correction will depend on how U.S. markets react when they next open and on how inflation and interest-rate expectations develop.
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