Asian equities slid sharply on Friday as a relentless sell-off in global technology stocks deepened investor anxiety over ballooning artificial intelligence spending and stretched market valuations, extending Wall Street’s worst losing streak in months into the region.
Markets across Asia opened under heavy pressure after US stocks closed lower for a third straight session, with technology shares once again bearing the brunt of the losses. The renewed downturn reflects mounting concern that hundreds of billions of dollars being poured into artificial intelligence may not deliver timely or sustainable returns.
The broad risk-off mood rippled across asset classes. Silver suffered another steep drop, while bitcoin erased all gains recorded since Donald Trump’s victory in the US presidential election, underscoring the growing retreat from speculative assets.
After a strong rally in January, market sentiment has shifted markedly in February as investors reassess lofty tech valuations and the long-term payoff of aggressive AI investments. The unease has intensified during the ongoing earnings season, with major technology players unveiling massive capital expenditure plans. Amazon and Google parent Alphabet alone have signalled potential combined spending of about $385 billion on AI-related projects.
Read Also:
- Trump confirms US–Nigeria joint Airstrikes on ISIS targets in Sokoto on Christmas Day
- Coderina, Federal Government renew Robotics drive as Nigerian teens showcase AI skills in Abuja
- Breaking: Ex-NEXIM Boss Robert Orya jailed 490 years over ₦2.4bn fraud in landmark EFCC conviction
Investor nerves were further rattled after AI startup Anthropic, creator of the Claude chatbot, introduced a new tool capable of replacing multiple software applications, including those used in legal services and data marketing. The development has fuelled fears that AI could erode the pricing power of traditional software firms.
Saxo Markets analyst Charu Chanana noted that once artificial intelligence begins to replicate professional tasks such as drafting, coding and analysis, investors are forced to confront difficult questions about which companies will retain value and which will absorb the costs of adoption. She added that the pressure has been most visible in software-as-a-service stocks, where debates over disruption and long-term revenue models are intensifying.
On Wall Street, all three major indexes closed lower on Thursday, with the Nasdaq posting its worst three-day performance since the market turmoil sparked by Trump’s tariff moves in April. That negative momentum spilled into Asia, where Seoul, buoyed in recent months by its tech-heavy market, fell as much as five per cent before trimming losses to close 1.4 per cent lower.
Hong Kong, Shanghai, Singapore, Mumbai, Taipei and Manila also recorded significant losses, while Tokyo bucked the trend to finish higher. In Southeast Asia, Jakarta plunged more than two per cent after Moody’s cut Indonesia’s sovereign credit outlook to negative, citing concerns over fiscal stability, foreign reserves and mounting debt at state-owned enterprises.
The downgrade capped a bruising week for Indonesian equities, which have been under pressure since index compiler MSCI raised ownership concerns and delayed plans to include or increase the weighting of Indonesian stocks in its benchmarks.
Economic data from the United States added to the gloom. Figures showing US job openings at their lowest level since 2020, alongside the highest January job cuts since the 2009 financial crisis, have amplified fears that the world’s largest economy may be losing momentum.
Commodities were not spared. Silver plunged as much as 18 per cent before stabilising around $72 an ounce, its lowest level since December and far below last week’s peak above $121. Gold also slipped, falling below $4,800 before recovering slightly, still well off its recent high of $5,595.
The slide in precious metals followed a surge in the US dollar after Trump appointed a perceived policy hawk to lead the Federal Reserve, combined with easing geopolitical tensions that reduced demand for safe-haven assets.
Bitcoin remained firmly in the firing line, sliding to levels not seen since October and hovering just above $60,000. The cryptocurrency has now lost more than half its value since hitting a record above $126,000 late last year, wiping out gains driven by expectations of a more crypto-friendly US administration.
Pepperstone analyst Chris Weston said sentiment toward digital assets has turned deeply negative, warning that buyers attempting to enter the market are effectively trying to catch a falling knife as rallies remain brief and selling pressure intense.
In corporate news, shares of mining giant Rio Tinto ended flat in Sydney after earlier losses triggered by its decision to abandon merger talks with Glencore, a deal that would have created the world’s largest mining company valued at about $260 billion. Rio Tinto’s London-listed shares fell more than one per cent.
Japanese stocks found support after Toyota Motor Corp rose two per cent in Tokyo, following an upgrade of its profit and sales forecasts for the fiscal year despite the impact of US tariffs. The automaker also announced the appointment of finance chief Kenta Kon as its new chief executive, citing the need to accelerate decision-making.
