Some $2.3 billion in market value was wiped from the tech-heavy Nasdaq 100 index, which fell 6.3% on Thursday. Another $2.8 trillion was wiped from the market value of the S&P 500, which fell 4.4% — the worst day for both indexes in 18 months, when global tariffs imposed by President Donald Trump roiled markets.
U.S. futures were mixed Friday morning, but European stocks also opened lower after continued sell-offs in Asia.
South Korea’s Kospi index fell more than 8%, triggering a temporary trading halt across the market. There, AI data center memory suppliers Samsung and SK Hynix plunged more than 10% in the early hours, before recovering some of their losses. Japan’s Nikkei 225 index fell 6%, entering bearish territory.
In Taiwan, home to some of the most critical AI companies including chip supplier TSMC, the benchmark TAIEX index fell 9%.
The situation was not much better in Europe. London’s FTSE 100 index fell almost 2%, while the French and German indices, CAC40 and DAX, suffered similar losses.
“Markets are being punished based on their reliance on the U.S. AI infrastructure cycle,” Charu Chanana, chief investment strategist at Singapore-based SAXO Markets, told NBC News in emailed comments.
Companies in Taiwan, South Korea and Japan are “clearly strongly tied to the global AI investment cycle and so I’m not surprised to see the size of the correction today after the sharp correction in the United States,” Tai Hui, JP Morgan’s chief APAC market strategist, told NBC News in emailed comments.
The plunge came after stunning midterm results that will see a series of anti-AI and anti-data center politicians take office, including Governor-elect Gina Hinojosa in Texas, the nation’s largest data center market.
The Democratic Congress could tighten its control over the industry, including AI infrastructure projects, which could lead to delays and additional costs, heightening investors’ concerns about the profitability of these investments.
Asian markets were already in difficulty
The months leading up to the U.S. election had already been a roller coaster ride for Asian investors, who saw their fortunes soar in June during the AI stock boom but suffered a recent sharp sell-off.
The feeling that the initial valuations of major AI companies were inflated was embarrassing enough for Asian markets, but the Democratic victory introduced another layer of uncertainty.
Markets widely expected losses for Trump’s Republicans, but not on this scale.
“This is extremely important for Asia because much of the hardware that supports U.S. AI ambitions is made here,” said Chanana, of SAXO Markets.
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