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Asian Markets Stumble as Tech Stocks Slump and Bitcoin Falters
Asian markets retreated sharply Thursday, with technology stocks bearing the brunt of the selloff amid growing investor concerns about inflated valuations in the sector. South Korea’s benchmark Kospi index plummeted nearly 4%, while cryptocurrency markets saw significant volatility with Bitcoin dropping to its lowest level in months.
The tech-heavy Kospi closed down 3.9% at 5,163.57, dragged lower by the country’s major technology companies. Samsung Electronics, South Korea’s largest company, tumbled 5.9%, while semiconductor manufacturer SK Hynix plunged 6.7% as investors reassessed the growth trajectory of these market leaders.
Bitcoin, which has been on a volatile run in recent weeks, crashed to around $69,000 before recovering slightly to trade near $71,000, marking a 7.3% decline. The cryptocurrency’s weakness followed comments from U.S. Treasury Secretary Scott Bessent, who stated during testimony to the House Financial Services Committee that he lacked authority to direct banks to purchase such digital assets.
Other Asian markets also posted losses, with Tokyo’s Nikkei 225 declining 0.9% to 53,818.04 and Taiwan’s Taiex dropping 1.5%. The Shanghai Composite index slid 0.6% to 4,075.92, while Australia’s S&P/ASX 200 fell 0.4% to 8,889.20. Hong Kong’s Hang Seng index bucked the trend, recovering from early losses to close 0.1% higher at 26,885.24.
The negative sentiment in Asia followed a mixed session on Wall Street, where the S&P 500 fell 0.5% on Wednesday, marking its fifth modest loss in six trading days. While the Dow Jones Industrial Average managed to rise 0.5%, the tech-focused Nasdaq composite sank 1.5%.
Advanced Micro Devices exemplified the pressure on tech stocks, plunging 17.3% despite reporting quarterly profits above analyst expectations. The chipmaker’s forecast for early 2026 revenue exceeded market projections, but investors appeared unsatisfied given the stock had doubled over the previous 12 months.
Market analysts note that technology companies face heightened scrutiny even when delivering strong results, as their elevated valuations leave little room for disappointment. Software companies face additional challenges from competitors leveraging artificial intelligence technology.
Not all tech stocks suffered, however. Super Micro Computer surged 13.8% after reporting better-than-expected profits. The company, which supplies AI servers and related equipment, has benefited from the ongoing artificial intelligence boom.
Meanwhile, Walmart edged up 0.2%, a day after its market capitalization surpassed $1 trillion for the first time. The retail giant joined an exclusive club dominated by technology behemoths like Nvidia and Apple, which each exceed $4 trillion in market value.
In the commodities sector, oil prices declined significantly, with U.S. benchmark crude falling $1.05 to $64.09 per barrel and Brent crude, the international standard, dropping $1.11 to $68.35 per barrel.
Precious metals continued their recent volatility, with gold rising marginally by 0.2% while silver plummeted 4.6%. These metals have experienced dramatic price swings as investors sought safe-haven assets amid concerns about tariffs, currency fluctuations, and government debt levels. Critics suggest the recent price surges were unsustainable and due for correction.
Currency markets saw modest movements, with the dollar strengthening to 157.03 Japanese yen from 156.88 yen. The euro weakened slightly against the dollar, trading at $1.1805 compared to $1.1809 previously.
European markets showed mixed performance in early trading, with Germany’s DAX slipping 0.2% to 24,568.67, France’s CAC 40 edging up 0.2% to 8,278.99, and Britain’s FTSE 100 declining 0.3% to 10,371.83.
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10 Comments
The downturn in Asian markets, particularly the Kospi and Bitcoin, is worrying. It highlights the interconnectedness of global markets and the potential for contagion. Investors will be closely watching for signs of stabilization.
Absolutely, the spillover effects across markets are concerning. The tech and crypto sectors appear to be the epicenter of this sell-off, but the broader economic implications remain to be seen.
This latest tech-led sell-off is a reminder of the risks in the market, especially for investors heavily exposed to the sector. Diversification and caution seem prudent given the potential for further volatility.
Well said. Diversification is key, especially for those with significant tech holdings. The market seems to be undergoing a correction, which is never easy to navigate but can present opportunities for savvy investors.
This tech-led sell-off is a timely reminder that markets can be volatile, even for high-flying sectors like technology. Prudent risk management and diversification will be crucial for investors navigating the current environment.
Well put. Maintaining a balanced portfolio and not getting overly exposed to any single sector or asset class is sound advice, especially during periods of heightened market uncertainty.
The volatility in the crypto markets is not surprising given the speculative nature of the asset class. However, the impact on broader tech stocks is more worrying. The industry may be due for a correction after a long bull run.
Agreed, the crypto volatility is expected but the tech stock sell-off is a bigger concern. Investors may be reassessing their positions in high-growth, high-valuation tech companies.
The tech sell-off is concerning, especially with the plunge in Bitcoin and the Kospi index. Investors seem wary of inflated valuations in the sector. It will be interesting to see how the markets react in the coming days.
You’re right, the sharp drops in tech stocks and crypto are quite unsettling. The comments from the US Treasury Secretary about lacking authority to direct banks to buy digital assets likely added to the uncertainty.