Asian equities fell sharply on Friday, 26 June, as heavyweight semiconductor stocks gave back a portion of their previous session’s gains, highlighting the volatility that has gripped global technology markets this week.
South Korean stocks plunged on Friday as chipmakers came under heavy selling pressure, underscoring the sector’s sensitivity to shifts in global sentiment surrounding artificial intelligence.
The benchmark Kospi index tumbled as much as 8.2%, wiping out the previous session’s gains and triggering a 20-minute trading halt by the Korea Exchange. It marked the second time this week that trading was temporarily suspended due to sharp market moves.
Japan’s Nikkei share average retreated sharply on Friday after closing at a record high in the previous session, as technology stocks came under pressure.
The benchmark Nikkei fell 3.7% to 69,704.88 by 0219 GMT, reversing part of Thursday’s 4.6% rally. SoftBank Group led the decline, tumbling more than 12% after reports that OpenAI is likely to delay its planned initial public offering.
US equity futures also pointed to a weaker opening, with Nasdaq-100 futures down 0.6% and S&P 500 futures down 0.2%.
The Indian stock market is closed today, 26 June, for the Muharram holiday. Trading on both the major stock exchanges, BSE and the National Stock Exchange (NSE), will remain shut today.
Wall Street rally loses steam
The US stock market ended mixed on Thursday, with the Nasdaq closing lower, weighed down by losses in Big Tech shares.
The Dow Jones Industrial Average rose 71.72 points, or 0.14%, to 51,920.62, while the S&P 500 eased 0.73 points, or 0.01%, to 7,357.49. The Nasdaq Composite closed 118.03 points, or 0.46%, lower at 25,358.60.
The weakness followed a mixed session on Wall Street, where the S&P 500 ended largely unchanged after failing to hold on to early gains sparked by Micron Technology’s upbeat earnings and guidance.
Apple emerged as the biggest drag on sentiment, with its shares plunging 6.1% after the company announced price increases for Macs, iPads, and home devices. The decline also weighed on the broader Magnificent Seven group of technology stocks.
Oil eases as Strait of Hormuz concerns persist
Brent crude edged lower after posting gains on Thursday, when reports of a projectile strike on a vessel in the Strait of Hormuz renewed concerns over the safety of shipping through one of the world’s most important energy trade routes.
Meanwhile, bond markets scaled back expectations of a Federal Reserve interest-rate hike after the US central bank’s preferred inflation gauge rose less than anticipated.
AI-driven volatility keeps investors cautious
Global equity markets are set to end a volatile week, with concerns over whether massive investments in artificial intelligence will generate sufficient returns, triggering sharp swings in technology stocks.
While Micron’s strong quarterly results and optimistic outlook offered some reassurance to investors, caution remains elevated. Both the MSCI Asia Pacific Index and the S&P 500 are on track to post their first monthly decline of the quarter.
Chip stocks retreat after previous rally
Although the Nasdaq 100 closed 0.8% higher on Thursday after rising as much as 2.1% during the session, the gains were not enough to sustain positive sentiment across Asian markets.
Alongside Micron, Qualcomm shares rallied after the company projected annual AI data-centre component sales exceeding $15 billion by fiscal 2029.
However, Asian semiconductor stocks reversed course on Friday. Shares of SK Hynix, Samsung Electronics, and Kioxia Holdings were among the biggest drags on the MSCI Asia Pacific Index after surging in the previous session.
OpenAI IPO reportedly delayed
Separately, OpenAI is reportedly leaning toward postponing its initial public offering until 2027, according to a New York Times report citing people familiar with the company’s internal discussions.
(With inputs from Bloomberg)
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