Asian equity markets moved lower on Thursday, stepping back from the record levels reached earlier in the week as heightened volatility in global technology stocks and worries about AI-driven disruption undermined investor appetite.
The regional pullback followed a sharp decline in U.S. technology shares overnight, where the Nasdaq fell more than broader benchmarks, prompting investors to unwind recent gains. In early Asian trading, U.S. stock index futures were largely flat.
Market movers and sector focus
Technology and semiconductor stocks were the principal drivers of the sell-off. Market participants attributed the weakness to growing concern that fast-moving advances in artificial intelligence could alter existing business models and compress margins, leading many to take profits after a strong rally in recent sessions.
South Korea's main gauge, the KOSPI, plunged 3.7% after having surged to record levels over the prior two trading sessions. Major Korean technology exporters suffered sharp losses: Samsung Electronics (KS:005930) and SK Hynix (KS:000660) each declined by more than 5% as investors booked gains.
In China, the blue chip Shanghai Shenzhen CSI 300 index and the Shanghai Composite index each retreated by nearly 1%. Hong Kong's Hang Seng fell 1.2%, while the Hang Seng TECH sub-index lost 1.5%, reflecting the regionwide pressure on tech-related equities.
Japan and selective cushions
Japan's Nikkei 225 eased about 1%, pulling back from record highs reached earlier in the week as local technology stocks tracked losses on Wall Street. The Nikkei's decline was partially offset by strong performances in specific names: Panasonic (TYO:6752) jumped after reporting robust earnings and providing upbeat guidance, and Renesas Electronics (TYO:6723) rose following its announcement to sell its timing business to U.S.-based SiTime in a transaction valued at about $3 billion.
The broader TOPIX index was largely unchanged, indicating relative resilience beyond the technology segment.
Other regional moves and economic notes
Singapore's Straits Times Index slipped 0.4% after closing at a record high in the prior session. Australia's S&P/ASX 200 also fell 0.4%, in line with the regional downturn, as investors absorbed trade data released earlier in the day. Australia's trade surplus widened less than expected in December, a result attributed to tepid export growth alongside softer imports, which market participants interpreted as a sign of uneven global demand.
Futures tied to India's Nifty 50 moved down about 0.3% in early trading.
Outlook
Market participants are watching technology and semiconductor names closely as profit-taking and concerns about AI-related margin pressure continue to influence flows. In the near term, prices appear sensitive to earnings updates, corporate announcements and economic data that could reaffirm or allay concerns about demand and margins.