The market retreat wiped more than $3.2 trillion from U.S. equities, hitting chipmakers like SanDisk, Micron, and AMD with double-digit losses. Losses extended across the Pacific, driving sharp downturns across benchmark indices in South Korea, Japan, and Taiwan. Heightened fears over a Democrat-controlled Congress have worsened existing investor caution following lackluster Magnificent Seven financial results. Moving forward, financial markets are closely monitoring impending U.S. non-farm payroll data and consumer confidence figures for further economic direction.
Key points
Regulatory scrutiny surrounding artificial intelligence infrastructure approvals has esca…: Regulatory scrutiny surrounding artificial intelligence infrastructure approvals has escalated following the Democratic Party's midterm success.
Tech equities were already primed for a pullback after recent Magnificent Seven earnings…: Tech equities were already primed for a pullback after recent Magnificent Seven earnings pointed to decelerating AI expenditure.
Traders are shifting their focus toward upcoming United States non-farm payrolls and cons…: Traders are shifting their focus toward upcoming United States non-farm payrolls and consumer sentiment reports to assess ongoing stability.
Sources checked by our analysis pipeline: 1
Introduction: Global stocks tumble as AI panic grips markets
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Fears that the Democratic Party’s blue wave in this week’s midterm elections will sink the AI investment boom are roiling markets, following heavy losses on Wall Street last night.
Asia-Pacific markets are a sea of red (unlike the US election map on Tuesday night!), as investors ditch tech stocks after more than $3.2tn was wiped off the US stock market yesterday.
Today, Japan’s Nikkei stock index has slumped by almost 6% – its worst drop since April 7 2025 during the ‘liberation day’ tariff panic.
South Korea’s KOSPI is down 6.7%, and Taiwan’s TAIEX has dropped by 4.5% in a broad rout.
Christopher Forbes, head of Asia and Middle East at CMCMarkets, called the market action “a bit of a disaster”, explaining (via Reuters):
“(Clients) were long index, long stocks, and they all got carried out.
“All night, all day – we had client margin calls, client complaints, ... because it’s a very emotional…
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