Business · World News Bureau

Asia's Black Friday: Tokyo's historic AI crash

Japan's Nikkei fell 3,643 points — its third-largest drop on record — as Seoul hit a circuit breaker and Asia's AI exporters took a second-day pounding.

LSN World News · 7 November 2026

Asia's Black Friday: Tokyo's historic AI crash

<p><em>Special Reporting from LSN News, adapted from today's Asia Money Map episode. <a href="https://youtu.be/G9mEsZY9R1k" target="_blank" rel="noopener">Watch the video on YouTube.</a></em></p>

<p>Japan's Nikkei 225 fell 3,643 points, or 5.96%, on Friday to close at 57,434.77, according to The Japan Times and Kabutan. It was the third-largest point drop in the index's history and the first close below 60,000 since May. SoftBank Group tumbled 10.83%, memory chipmaker Kioxia fell 8.72%, and Rohm slid 15%. The broader Topix lost about 5.9%, with all 33 industry sectors down, RTHK reported.</p>

<p>The overnight cue came from Wall Street. The Nasdaq Composite sank 5.5% on Thursday, its worst day since April 2025, and closed more than 10% below its recent peak, CNBC said. The Philadelphia Semiconductor Index plunged about 12.2%. Investors priced a Democratic midterm sweep as a brake on US data-centre buildouts. Texas governor-elect Gina Hinojosa has already suspended new data-centre approvals until the state writes protections, The Japan Times reported.</p>

<h2>Tokyo and Seoul take the AI hit</h2>

<p>In Tokyo, the Nikkei fell as much as 7.09% in the morning before closing down 5.96%. Only about 1% of Tokyo Stock Exchange Prime issues finished higher, Kabutan said, on turnover of roughly 12.5 trillion yen. Chip-equipment names Advantest and Tokyo Electron each dropped about 5%.</p>

<p>Seoul was not spared for a second day. The Kospi plunged 6.02% to 5,059, according to RTHK, after Thursday's 5.3% drop. At one point on Friday morning the index was down more than 8%, and the Korea Exchange imposed a circuit breaker that halted trading for 20 minutes, Nikkei Asia and CNA reported. Samsung Electronics shed 6.35% and SK Hynix dropped 10.44%, CNBC said. For the week the Kospi was down about 11.7%, and it has fallen roughly 44% from its June peak, though it remains up about 20% year to date.</p>

<p>Taiwan's TSMC fell 4.69%, CNBC reported. In Singapore, CNA said the Straits Times Index was down more than 2% in morning trade as local chip suppliers plunged in early deals.</p>

<h2>Hong Kong and China: softer, not freefall</h2>

<p>The Hang Seng closed down about 1.3%, or 315 points, at 24,481, according to RTHK. Hang Seng Tech fell about 1.8%. Yet for the week the Hang Seng still gained about 5.1%, its best week since March 2025. The CSI 300 dropped 1.4% on Friday but posted a 1.7% weekly gain, snapping a 12-week losing streak. Shanghai closed down 1.1% at 3,649. Optical-transceiver names tied to US data centres were hit hard: Zhongji Innolight slumped 9.2% and Eoptolink fell 7.3%.</p>

<h2>Oil relief did not stop the crash</h2>

<p>Brent crude settled only three cents higher at $98.32 on Friday, CNBC reported, after a week in which Brent lost more than 16%. That is relief for Asia's importers, but it did not stop the equity crash. The AI trade is pricing politics, not jet fuel.</p>

<p>Our read: Thursday was the first crack. Friday was the confirmation. Asia's AI exporters — Japan, Korea and Taiwan — are being repriced for a slower US data-centre pipeline. China and Hong Kong still have a domestic-support floor that the chip exporters do not. Goldman Sachs Asia Pacific equity strategist Timothy Moe told CNBC the market is shooting first and asking questions later on the speed of the US buildout. Treat Friday's Tokyo crash as the regional verdict on AI capex risk: size Asia tech for tighter US approvals, keep China's policy floor in a separate bucket, and do not let cheaper weekly oil distract from the equity story.</p>

<h2>Sources</h2>

<ul>

<li><a href="https://www.japantimes.co.jp/business/2026/11/06/markets/market-nov-6/" target="_blank" rel="noopener">Japan Times</a></li>

<li><a href="https://en.kabutan.com/jp/news/n202611061585" target="_blank" rel="noopener">Kabutan</a></li>

<li><a href="https://asia.nikkei.com/business/markets/taiwan-south-korea-japan-stock-markets-hit-hard-by-ai-sell-off" target="_blank" rel="noopener">Nikkei Asia</a></li>

</ul>