BENGALURU: A steep selloff in tech-heavy South Korean and Taiwanese stocks pulled the broader Asian market to a three-month low on Tuesday, while the Indonesian rupiah skirted a record low after the surprise exit of its central bank chief.
Recent US tech earnings have forced investors to reassess whether massive capital spending on AI will deliver adequate financial returns.
Some of the biggest beneficiaries of the AI rally, Asian semiconductor stocks, tumbled on the day, a selloff analysts attributed to a combination of concerns over AI infrastructure financing, China’s technological advances and rising competition.
The MSCI EM Asia index fell more than 4 percent, while the EM Asia IT index dropped 7.9 percent in its worst day since May 1.
South Korea’s KOSPI and Taiwan shares - which make up more than 90 percent of the tech index - fell 10 percent and more than 4 percent, respectively.