A tech sell-off drags stocks lower as markets in South Korea and Japan sink

A dealer walks near the screens showing the Korea Composite Stock Price Index (KOSPI) and the foreign exchange rate between U.S. dollar and South Korean won at a dealing room of Hana Bank in Seoul, South Korea, Thursday, Oct. 15, 2026. (AP Photo/Lee Jin-man)

HONG KONG — Global shares mostly declined, led by sharp drops in Asia, as a sell-off of technology shares deepened after U.S. stocks fell on hotter-than-expected inflation data.

U.S. equity futures were mixed.

In early European trading, Britain’s FTSE 100 rose 0.5 per cent to 10,781.63, after the U.K. economy recorded an unexpected growth in August. France’s CAC 40 added 0.3 per cent to 7,899.56, and Germany’s DAX was down 0.3 per cent to 25,236.07.

In Asia, South Korea’s benchmark Kospi index lost 7.6 per cent to 5,554.22. It plummeted more than 16 per cent over the past month and was well below the 9,000 mark that it crossed in June at its all-time high driven by optimism over the global artificial intelligence frenzy.

Samsung Electronics slid 9.5 per cent and South Korean memory chipmaker SK Hynix plunged 11.1 per cent.

Japan’s Nikkei 225 tumbled 4.9 per cent to 64,425.95. OpenAI investor SoftBank Group lost 9.3 per cent. Chip equipment maker Tokyo Electron dropped 7.8 per cent, and memory chipmaker Kioxia Holdings lost 12.3 per cent.

Taiwan’s Taiex, which also benefited from the AI boom, fell 3.4 per cent. Its leading chipmaker Taiwan Semiconductor Manufacturing Co., or TSMC, dropped 2 per cent ahead of its earnings report. TSMC reported on Thursday another record profit for the latest quarter, which was better than what analysts had expected, and the company said AI demand remains very strong.

“The problem for heavily technology-weighted markets such as Korea and Taiwan, to a lesser extent Japan, is that any risk to perceived AI spending growth may lead to slower demand growth for chips and equipment,” said Lorraine Tan, director of equity research for Asia at Morningstar.

“The key issue is a possible mismatch between market’s growth expectations for the tech sector and what may eventuate,” she said.

Hong Kong’s Hang Seng dropped 1 per cent to 24,062.72. The Shanghai Composite index slipped 1.6 per cent to 3,707.48.

Australia’s S&P/ASX 200 edged down 0.1 per cent to 8,719.70.

The stock declines followed losses on Wall Street on Wednesday. The S&P 500 dropped 1.1 per cent, the Dow Jones Industrial Average dipped 0.1 per cent, and the technology-heavy Nasdaq composite slipped 1.9 per cent as AI-related stocks fell.

Nvidia lost 3.2 per cent, Broadcom gave up 3.1 per cent, and Advanced Micro Devices, or AMD, declined 5.7 per cent.

The U.S. reported Wednesday that the consumer price index rose 3.7 per cent year-on-year in September, up from 3.4 per cent in August and worse than what economists had expected.

Stocks have also faced downward pressure from surging bond yields and a volatile bond market. Yields on longer-term U.S. Treasurys have jumped over inflation worries fueled by the global energy shock driven by the Iran war and continuously rising U.S. government debt.

But the bond sell-off appeared to have eased significantly early Thursday. The yield on the 10-year U.S. Treasury was at 5.09 per cent after briefly jumping to above 5.32 per cent Wednesday. It had reached 5.35 per cent earlier this month as it hit its highest level since 2002.

Oil prices fell as tensions and uncertainties surrounding global oil supply and the situation in the Middle East dragged on. Brent crude, the international standard, declined 2 per cent to US$103.93 per barrel. That’s still elevated compared with the approximately $72 per barrel level before the start of the Iran war in late February.

The U.S. dollar fell to 157.80 Japanese yen from 158.33 yen. The euro was trading at US$1.1224, up from $1.1157.

Chan Ho-him, The Associated Press