Asian stock markets fell sharply on Friday as a global selloff in technology shares intensified, with South Korea’s KOSPI dropping over 8% and triggering a circuit breaker, while Japan’s Nikkei declined nearly 5% on concerns that the artificial intelligence-driven rally may have advanced too quickly.
South Korea’s KOSPI slid 8.2%, forcing authorities to temporarily suspend program trading for 20 minutes after steep losses spread across the market. Japan’s Nikkei 225 fell 5%, Hong Kong’s Hang Seng lost 2.4%, China’s CSI300 declined 2.9%, and the Shanghai Composite also dropped more than 2%. The decline followed another broad-based fall across Asian markets earlier in the week.
The MSCI Asia-Pacific index excluding Japan fell 3.8%, putting it on track for its worst weekly performance in over a year, after a strong rally earlier in the quarter.
The downturn was triggered by heavy losses on Wall Street, where Apple lost nearly $250 billion in market value after announcing price increases for iPads and MacBooks to offset rising memory and storage chip costs. Apple’s shares fell 6.1%, raising concerns that increasing AI-related infrastructure and semiconductor costs are beginning to pressure even major global tech firms.
This dampened optimism that had been lifted just a day earlier by strong earnings from memory-chip maker Micron Technology, which had boosted confidence in AI demand and pushed its stock to record highs.
According to analysts, Apple’s price hikes highlight how large technology firms may eventually feel the impact of rising component costs, potentially creating broader challenges for the tech ecosystem through higher expenses and capital requirements.
The technology sector selloff was especially sharp in Asia. China’s AI-focused index fell 5%, its 5G communications index dropped 6.3%, and major suppliers like Zhongji Innolight also declined significantly. Hong Kong’s Hang Seng Tech Index fell 3.3% and was heading for its worst weekly performance since October 2025.
Some analysts said the decline was also driven by profit-taking at the end of a strong quarter, after major gains in recent months.
Despite Friday’s fall, markets remain up significantly over the broader period, with South Korea’s KOSPI still up around 62% for the quarter, Japan’s Nikkei up about 34%, and the MSCI Asia-Pacific index up more than 20%.
Additional pressure came from weak U.S. futures, with Nasdaq futures falling 1.7% in Asian trading after reports that OpenAI may delay its planned public listing until next year, adding to uncertainty around AI-related valuations.
Oil prices also declined, with Brent crude falling below $74 per barrel after Saudi Aramco resumed shipments from its Ras Tanura export terminal. However, lower oil prices did little to improve overall sentiment.
The Japanese yen remained near a 40-year low against the U.S. dollar, raising speculation about possible intervention by authorities to stabilize the currency.
Overall, analysts said the selloff does not necessarily mark the end of the AI-driven rally, but reflects concerns that valuations had become stretched after months of strong gains. With technology stocks dominating global returns this year, any signs of pressure on earnings or margins are now prompting faster risk reduction by investors.
The combination of high AI valuations, rising costs, end-of-quarter profit booking, and uncertainty around future earnings has turned one of the year’s strongest market trends into a sharp global correction.
