Asian markets slipped into a sharp decline as major technology companies pulled indexes lower. Investors grew uneasy about soaring valuations in the artificial intelligence sector, triggering widespread selling across chipmakers and AI-driven firms. The downturn followed weak signals from Wall Street, where tech giants also struggled under the weight of doubts about their long-term AI spending and growth projections.
Chipmakers in South Korea Face Heavy Losses
South Korea experienced one of the steepest drops. The KOSPI fell nearly 4 percent, and the country’s top semiconductor players absorbed the heaviest blow. Samsung Electronics tumbled more than 5 percent, while SK Hynix plunged over 8 percent.
Both companies have benefited from the global AI boom, yet market sentiment shifted quickly as investors reassessed whether demand can keep pace with the rapid buildup in AI hardware capacity.
Japanese and Taiwanese Tech Giants Add to the Sell-Off
Japan and Taiwan also felt the impact. SoftBank sank by more than 10 percent as concerns rose about its exposure to ambitious AI ventures. Meanwhile, Taiwan Semiconductor Manufacturing Company, a core supplier for AI processors, recorded notable declines as doubts spread about the sustainability of current demand trends. The sudden pullback signaled that fears of overheating in the AI ecosystem were no longer confined to U.S. markets.
The latest rout revived a debate that had been simmering quietly for months: whether the AI sector is inflating into a bubble. Despite strong earnings from key industry players, many analysts believe the rally has moved faster than the underlying fundamentals. Heavy concentration of investor enthusiasm in a small group of companies has made the market more fragile, and even a hint of uncertainty now triggers an outsized reaction.
