Asian shares plunge as tech rout deepens, SoftBank sinks 9%

Tokyo [Japan], July 17, (ANI): Asian shares slumped on Friday, led by Nikkei, which plunged more than 4 per cent as the tech selloff deepened with investors opting to observe caution on the red-hot AI rally that catapulted stock markets to new highs in the first half of this year.

Shares of Japanese tech giant SoftBank slid more than 9 per cent, tracking overall weakness in AI-related stocks in the US market. The tech-heavy Nasdaq index fell around 1.5 per cent overnight, with shares of Korean chipmaker SK Hynix listed in the US falling 13.7 per cent on Thursday. Korean markets are closed today.

Japan’s Kioxia Holdings plunged 16 per cent as the AI exuberance faded and after a Texas federal jury ordered the flash memory giant to pay Viasat USD 229 million for infringing a patent. The company’s shares have seen a massive sell-off after it overtook Toyota last month to become Japan’s most valuable company.

Shares in Taiwan dropped more than 6 per cent on Friday with its most valuable company and world’s largest foundry, TSMC, plunging more than 7 per cent, a day after reporting blockbuster earnings and plans to spend an additional USD 100 billion in Arizona. TSMC raised its sales growth forecast for the second time this year, projecting a growth of more than 40 per cent. Its chairman said that the optimism springs from a positive outlook by its clients and clients’ clients.

Rising prices of memory chips have become a challenge for the consumer tech industry as it faces a crunch that is likely to make consumer tech products expensive. Apple has already hiked prices of some of its offerings, and others are likely to follow suit.

Chip stocks zoomed to record highs in the first half of this year with shares of SK Hynix, Samsung and American chipmaker Micron entering the USD 1 trillion valuation club. However, the AI rally has somewhat fizzled with investors weighing whether the huge amount of investments in the AI-related stocks will lead to healthy and sustainable returns. (ANI)

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