Henry Willy
Asian Markets Slide After Tech Losses Drag Down Wall Street
Asian shares fell Thursday after fresh declines in technology sectors weighed on Wall Street. Tokyo's Nikkei 225 was down 0.7% to 53,935.77, while South Korea's Kospi dropped 3.2% to 5,199.47. Chinese markets also fell, with Hong Kong's Hang Seng down 1.2% at 26,516.38. The Shanghai Composite index declined 0.8% to 4,069.27. Australia's S&P/ASX 200 slid 0.3% to 8,902.20, while Taiwan's Taiex fell 1.1%.
More declines in technology companies dragged on Wall Street Wednesday. The S&P 500 lost 0.5% on Wednesday, marking its fifth minor fall in the last six days, closing at 6,882.72. The Dow Jones Industrial Average gained 260 points, or 0.5%, to 49,501.30. The Nasdaq composite fell 1.5%, to 22,904.58. Overall, the S&P 500 dropped 35.09 points to 6,882.72.
Why This News Matters
Prices have been going up for months and then suddenly dropped, which has made investors lose faith in the leaders of Big Tech and AI. People are still selling IT stocks, even though they are making a lot of money. Prices seem way too high, and more and more people are starting to believe that the AI boom isn't over yet. The downturn spread from Wall Street to Asian markets, showing how closely linked trade is around the world. When tech stocks in the U.S. go down, the whole world feels it. Investors aren't leaving the markets; they're just moving to things that seem safer, like gold and other safe havens.
Technology Stocks Under Pressure
More than twice as many stocks rose as fell in the S&P 500, although declining technology firms dragged on the index for the second day in a row. Even when they achieve higher-than-expected profits, tech stocks face criticism since their valuations have skyrocketed as they have grown to dominate markets. Big Tech stocks are under fire for skyrocketing prices as a result of their market domination over the years. U.S. stocks closed lower on Wednesday, with losses in Advanced Micro Devices, Palantir, and other technology companies, as investors were concerned about high valuations and if Wall Street's AI surge had peaked.
Advanced Micro Devices fell 17.3% despite reporting a higher-than-expected profit for the previous quarter. It also provided a revenue prediction for the beginning of 2026 that outperformed analysts' forecasts. Advanced Micro Devices fell 17% as the chipmaker estimated quarterly revenue that disappointed investors and signaled it is struggling to compete with AI powerhouse Nvidia. Nvidia declined 3.4%, while the PHLX semiconductor index plummeted 4.4%. Palantir fell over 12%, reversing the previous day's significant gains, which were fueled by the AI data company's outstanding quarterly earnings. Alphabet slumped over 2% ahead of its quarterly earnings after the bell.
After the closing, it rose 2% as the company said that it was aggressively increasing spending as it deepened its investments in the AI race. Some software companies have added to their previous losses amid concerns that fast evolving AI may undermine sector stalwarts. Snowflake plummeted 4.6%, while Datadog lost 3.3%.
Notable Gainers and Decliners
Uber Technologies also weighed on the market, dropping 5.1%. The ride-hailing business posted statistics for the most recent quarter that fell short of analysts' estimates, as well as a profit forecast for the current quarter that was lower than analysts' expectations. Nonetheless, several tech stocks rose, like Super Micro Computer, which increased by 13.8%. Super Micro Computer's shares rose 13.8% after the business upped its annual revenue prediction due to strong demand for its AI-optimized servers.
Eli Lilly rose 10.3% after exceeding analysts' profit projections in the latest quarter. Limiting losses in the S&P 500, Eli Lilly shares rose around 10% as the firm forecasted 2026 profit beyond Wall Street expectations. Match Group rose 5.9% after announcing better-than-expected results and raising its dividend. Walmart gained 0.2% a day after its overall market value surpassed $1 trillion for the first time.
Markets Today: Gold and Silver Gain as Oil Slips, Dollar Mixed
Gold and silver prices increased after reducing earlier gains. Gold rose 0.3% to $4,950.80 per ounce, after briefly rising above $5,000. Silver prices jumped by 1.3%. Their prices had risen as investors sought safer havens for their money amid concerns about tariffs, a weaker US dollar, and high debt loads for governments throughout the world.
U.S. futures edged up, as oil prices fell more than $1 per barrel. In other trading early Thursday, US benchmark crude oil slipped $1.19 to $63.95 a barrel. Brent crude fell $1.24, to $68.22 per barrel. The dollar increased to 156.83 Japanese yen from 156.80. The euro dropped to $1.1795 from $1.1804.
Market Snapshot: Treasury Yields Steady as Global Stocks Trade Mixed
Treasury rates remained reasonably stable following a couple of conflicting data on the US economy. According to ADP Research, US firms outside of the government recruited fewer people last month than economists projected. A second report from the Institute for Supply Management stated that growth in health care, construction, and other U.S. service industries continued in January at the predicted rate.
In foreign stock markets, indexes were mixed across Europe and Asia. Japan's Nikkei 225 dropped 0.8% from its all-time high. Despite reporting high profits, Nintendo's stock fell 11%. South Korea's Kospi rose 1.6%, setting a new record. Investors dumping AI-related equities switched to less expensive companies that waited out the tech rise. The S&P 500 value index rose for the fifth consecutive session, while the S&P 500 growth index fell. Even as the S&P 500 fell, seven of the eleven S&P 500 sector indices increased, led by energy and followed by materials.
What to Watch Next
The next few sessions will depend on whether tech sales stay the same or pick up speed. Investors will be paying attention to the next earnings reports from big tech companies, advice on how much to spend on AI, and U.S. economic data that could change their expectations for interest rates. In Asia, watch to see if losses get worse or if buyers come in after recent drops. A big question still needs to be answered: is this just a healthy reset after a big rally, or is it the start of a bigger shift away from tech-heavy markets?
