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Asian shares sink as investors question returns from AI spending
Developed over time first seen 1 day ago
Global share markets fell sharply as investors questioned whether the vast sums being spent on artificial intelligence infrastructure will generate enough profit. The sell-off spread from US technology stocks to Asia and Europe, while uncertainty over potential restrictions on data-centre construction after Democrats won control of both chambers of Congress added to market concerns.
The Nasdaq dropped 5.52% on Thursday, at one point losing as much as $2.5 trillion in market value, and the S&P 500 fell 4.4%. In Asia, Japan’s Nikkei 225 fell 5.5%, South Korea’s Kospi slid as much as 8.8% and triggered a 20-minute trading halt, while Taiwan’s TAIEX lost more than 8%. European markets also declined, with the STOXX 600 down 1.6% in early Friday trading.
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In short
- Doubts over AI profits drove a global stock sell-off.
- The Nasdaq fell 5.52%, shedding up to $2.5 trillion in value.
- South Korea’s Kospi dropped 8.8%, triggering a 20-minute halt.
How this story developed
- 12 hours ago European shares erased their weekly gains as the STOXX 600 fell 1.6%, while most major regional markets lost more than 1%.
- 19 hours ago The sell-off broadened across global markets, with the STOXX 600 down 1.6% in early trading and Democrats’ control of both chambers of Congress adding to concerns about possible data centre restrictions.
- 19 hours ago European futures were also down 1%, signalling that the technology-led losses could reach markets beyond Asia.
- 22 hours ago Asian markets tumbled on Friday after a sharp US technology sell-off, as doubts grew over whether heavy investment in AI infrastructure would pay off and political uncertainty clouded data centre projects.
Full account
Asian markets fell sharply on Friday after a steep sell-off in US technology shares unsettled investors and spread through markets heavily exposed to the artificial intelligence industry. The downturn brought together two concerns: whether the enormous sums being committed to AI infrastructure will earn adequate returns, and whether the post-election US political climate could make new data-centre projects harder to build.
South Korea, Japan and Taiwan saw some of the heaviest falls. The Nikkei 225 was down about 5.5% in early trading, while the Kospi at one point lost 8.8%, prompting a 20-minute trading suspension. Taiwan’s Taiex also dropped sharply. Semiconductor and equipment makers were among the hardest hit: Samsung Electronics and SK Hynix fell steeply, as did Japan’s Tokyo Electron and Kioxia. European stock futures pointed to further losses as the sell-off threatened to extend beyond Asia.
The immediate trigger was Thursday’s retreat on Wall Street, led by companies tied to AI computing and data-centre construction. The Nasdaq fell more than 5%, while the S&P 500 also recorded a large decline. Investors have poured money into chips, servers and facilities in anticipation of rising demand for AI services; the latest market moves suggest growing uncertainty about how quickly that spending can translate into profits. The election result has added a political risk: some Democratic candidates who won office had called for tighter limits or pauses on data-centre development, amid local opposition to the projects.
The two reports frame the wider market picture differently. The first focuses on the AI investment thesis, the US election and the scale of the falls in individual Asian technology shares, including a quote describing a marked change in investor sentiment. City AM’s live market update instead foregrounds the likely pressure on London’s FTSE 100 and adds that oil was below $100 a barrel and heading for a weekly loss, which it linked to hopes of a quicker end to the Middle East conflict. Its snapshot gives somewhat smaller falls for Taiwan and describes the Kospi decline as more than 5%, while the first report records the index’s larger intraday low and trading halt. These figures reflect different points in a fast-moving session.
Where outlets differ
From the full account, which is AI-written from the sources:
The first report centres on AI spending returns, possible Democratic resistance to data-centre projects and specific Asian chip stocks; City AM emphasises the expected impact on the FTSE 100 and includes oil-market context.
The reported Asian declines vary: the first gives the Kospi’s intraday fall of as much as 8.8% and a 20-minute suspension, while City AM gives a fall of more than 5%; their Taiex figures also differ, at more than 8% versus just over 6%. The snapshots may have been taken at different times.
The first report includes investor commentary on a shift in sentiment and gives detailed US index losses; City AM offers a shorter market opening summary and links oil’s weekly decline to optimism about the Middle East conflict.
Centre outlets 2
- Asian shares sink as investors question returns from AI spendingDW
- European shares join a global sell-off as AI spending fears rattle Wall Street and Asian marketsDW
Only here: asian, shares, spending, investors, question
Right-leaning outlets 1
Only here: ftse, stocks, tech, rout, deepens
Every side used: sink
Headline columns compared word for word; nothing in them is AI-written.
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The case for
Investors may reasonably question whether the enormous sums going into AI chips, data centres and related infrastructure will produce profits large enough to justify current valuations. If expected returns disappoint, a sharp repricing could be warranted, and US political uncertainty over data-centre construction may add to the risks investors need to weigh.
The case against
The selloff may overstate the risks: AI infrastructure could support substantial future productivity and earnings, while near-term uncertainty about returns does not show that investment will fail. Broad falls across Asian markets, alongside steep declines in technology shares, may also reflect a rapid shift in sentiment that penalises companies before their long-term prospects are clear.
Explained simply
Artificial intelligence depends on large data centres filled with specialised computer chips. Building and equipping them costs technology companies and their customers billions of pounds, and spending has risen as firms race to develop and sell AI services.
Investors buy shares partly on the expectation that companies will make future profits. They are weighing whether income from AI will justify the cost of infrastructure, including chips made by firms such as Samsung and SK Hynix. Share prices can also react to uncertainty about government policy, which may affect plans for data centres and AI development.
Stock markets are linked through international investment and the fortunes of companies that supply one another. A reassessment of expected technology profits can therefore affect markets in several regions, with consequences for the value of investments and companies’ ability to raise money.
Coverage · 3 sources
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Originally published by DW as “Asian stocks slump after US tech rout amid AI jitters”.