Asian markets mostly declined Friday as another sell-off in artificial-intelligence shares rippled across global trading floors. The retreat helped drive the benchmark S&P 500 to its steepest one-day loss since July.
Oil prices remained near their highest point since May as investors continued to assess the impact of the war with Iran. Brent crude rose 0.5% to $113.73 a barrel, while U.S. benchmark crude gained 0.6% to $100.08.
Japan’s Nikkei 225 dropped 1.7% to 61,825.26, and South Korea’s Kospi slid 2.4% to 5,403.32.
Hong Kong was a relative bright spot, with the Hang Seng edging up 0.2% to 22,983.80. Mainland China’s Shanghai Composite, however, fell 1.3% to 3,610.52.
Australia’s S&P/ASX 200 declined 0.2% to finish at 8,777.00.
The pressure began in the United States on Thursday, when the S&P 500 lost 1.2% and the Nasdaq composite plunged 2.6%. Technology stocks fell so sharply that they concealed broader resilience in the market: most U.S. shares actually gained, while the Dow Jones Industrial Average edged up less than 0.1%.
Investors have grown increasingly uneasy about the artificial-intelligence boom, particularly the enormous cost of borrowing money to build data centers and purchase advanced chips. Although AI companies continue to post growth, some traders believe their share prices rose too far during the multiyear frenzy.
Meta Platforms fell 7% after the Facebook and Instagram parent reported quarterly revenue above Wall Street expectations, but profit came in below forecasts. The company, which is promoting its Muse AI agent, also announced plans to create a new class of shares to help fund AI projects and other costs.
Tesla shares dropped 3.1%. The electric vehicle maker delivered better-than-expected summer profits, but its revenue missed analysts’ projections.
Nvidia was among the biggest drags on the market, sliding 4.4% as the broader retreat in AI stocks intensified. Because Nvidia is Wall Street’s most valuable company, its share-price moves have an outsized effect on the S&P 500.
CoreWeave sank 10.1% amid continuing concern over its debt burden. The company has borrowed heavily to acquire Nvidia chips, which it then leases to customers through cloud services.
Rising energy costs added another challenge for stocks. Brent crude surged 4% Thursday and has climbed from below $97 a barrel at the beginning of the month as markets remain uncertain about when the war with Iran will stop disrupting the global energy industry.
Investors are also contending with heavy government debt and stretched budgets across much of the developed world. In France, protests have increased pressure on the government to spend more, a move that could deepen its debt problems.
In the United States, those fiscal concerns, persistent inflation and signs of a resilient economy have helped push Treasury yields to their highest levels in decades.
Yet Treasury yields dropped sharply Thursday as investors sought the relative safety of U.S. government bonds while AI shares came under heavy selling pressure.
The 10-year Treasury yield fell to 4.97%, down from 5.13% late Wednesday and more than 5.30% earlier this month. Such a rapid change is significant in the bond market.
The decline came despite fresh evidence that the U.S. economy could be holding up better than economists anticipated. A report showed that fewer Americans filed new unemployment-benefit claims last week, suggesting layoffs remain limited nationwide.
In early Friday currency trading, the U.S. dollar rose to 156.93 Japanese yen from 156.77 yen. The euro was little changed at $1.1215.
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AP Business Writer Stan Choe in New York contributed to this report.
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