Asian stocks slumped from the open after a post-election rout in chipmakers deepened on Wall Street amid growing concern that Democrats will seek tighter regulation of the artificial intelligence industry.
South Korea’s tech-heavy Kospi Index slid as much as 8.8% in early trading, triggering a circuit breaker, with chipmakers Samsung Electronics Co. and SK Hynix Inc. both plunging more than 9%. Japan’s benchmark Nikkei 225 Stock Average lost 5.5%, while the MSCI Asia Pacific Index declined 2.5%. Futures pointed to declines in Taiwan, Hong Kong and China.
The S&P 500 Index plunged 4.4% on Thursday to mark its worst performance since the April 2025 tariff meltdown. The Nasdaq 100 slid 6.4%, wiping out $2.3 trillion in value as it capped its worst session since March 2020. A closely watched gauge of chip giants tumbled 12%, with Nvidia Corp., Qualcomm Inc. and Arm Holdings Plc among the biggest decliners. In a sign markets may be starting to stabilize, futures on the Nasdaq gauge gained 0.7% in early Asian trade.
“This is a ‘blue trade’ panic pricing in policy risk,” said Anna Wu, an investment strategist and founder of Floodlines Research. There is “plenty of chip and equipment exposure still to unwind. Sentiment could weaken further until the chip side gets a reason to rally.”
Elsewhere, the dollar weakened against most of its Group-of-10 peers, while Treasuries held their gains from Thursday. US oil climbed above $91 a barrel after jumping 2.7% in the previous session.