Global equities retreated Wednesday as the AI-fueled tech trade lost steam, sparking a broad selloff from Asia to Europe and pointing to further weakness on Wall Street. South Korea’s Kospi fell more than 6% at its lows, Japan’s Nikkei dropped about 4.5%, and Hong Kong’s Hang Seng slipped over 1%, with Taiwan down roughly 2.5%. Europe opened lower as the STOXX 600 slid up to 0.7%, the FTSE 100 dipped 0.2% and Germany’s benchmark eased 0.7%. U.S. futures signaled more declines, with S&P 500 contracts off about 0.5% and Nasdaq futures down around 1%.
The reversal followed a sharp U.S. selloff Tuesday that knocked the S&P 500 by 1.1% and the Nasdaq by 2%, led by declines in AI bellwethers. Nvidia shed nearly 4% and Palantir fell almost 8% despite beating estimates. Weak updates from AMD and Super Micro Computer compounded concerns, while SoftBank tumbled over 14% in Tokyo, erasing more than $30 billion in value. Economists highlighted Asia’s heavy exposure to U.S. tech demand, particularly in chips, even as the year-to-date rally leaves the S&P 500 up more than 15% and the Nasdaq over 20%. Recent warnings from the chiefs of Goldman Sachs and Morgan Stanley about potential pullbacks added to caution over stretched AI valuations.
Global markets sink as doubts over frothy AI and tech valuations trigger selloff
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