Asian tech stocks plunge as US artificial intelligence selloff spreads

Asian technology stocks have come under significant pressure following a sharp pullback in artificial intelligence-related shares on US markets, with chipmakers and data centre equipment suppliers bearing the brunt of the decline. Investors have reassessed valuations in the AI sector, prompting a broad rotation away from companies that have benefited from the technology boom.

Manufacturers in South Korea, Taiwan and Japan have proven particularly vulnerable to the shift in market sentiment. These nations' economies are heavily reliant on semiconductor production and supporting equipment supply chains that have surged in demand as data centre capacity expansions accelerate globally.

The regional sell-off reflects the interconnected nature of technology markets across Asia and the United States. Many Korean, Taiwanese and Japanese firms supply critical components to major US technology companies and data centre operators, making them sensitive to changes in demand forecasts and investment cycles.

Analysts noted that the pullback serves as a reminder of the concentration risk within the AI sector, where elevated valuations have attracted retail and institutional investment alike. The unwinding of these positions has created volatility across multiple Asian markets where technology stocks carry significant index weightings.