Asian technology shares suffered steep losses on Friday, November 6, following a sharp overnight decline on Wall Street that pushed the Nasdaq Composite into correction territory. The selling spread across chipmakers, electronics manufacturers and semiconductor equipment suppliers as investors questioned the sustainability of artificial intelligence spending and the returns from large investments in data centers.
Political concerns added to the pressure. Investors worried that Democrats' sweeping victory in the U.S. midterm elections could bring tighter restrictions on data-center development. Those concerns centered on whether limits on construction could slow demand for AI chips and the infrastructure that supports them, with consequences for Asian technology suppliers.
South Korea's technology sector recorded broad declines. SK Hynix dropped more than 8%, while Samsung Electronics lost 7%. The losses extended to LG Innotek, which fell 10%, and LG Display, which declined 7.7%, showing that the selling pressure reached beyond the country's major chipmakers.
Japanese semiconductor-related shares also retreated sharply. Advantest, which makes chip-testing equipment, plunged 12.2%, and Tokyo Electron fell 7.3%. Technology investment group SoftBank Group dropped 11.6%. Memory chipmaker Kioxia Holdings lost nearly 10%, while Renesas Electronics declined 7.5%, adding to the losses across Japan's technology stocks.
In Taiwan, contract chipmaker TSMC slid 9.6% as semiconductor shares faced heavy selling. Electronics manufacturers were also caught in the decline. Hon Hai Precision Industry, which is also known as Foxconn, fell 9.4%, while Foxconn Technology dropped 9.1%. The losses added another major Asian technology market to the regional retreat.
The Asian declines came after the Nasdaq Composite sank 5.5% in the preceding U.S. session. The index finished more than 10% below its recent peak, putting it in correction territory as doubts about the AI investment boom intensified. Semiconductor stocks suffered particularly heavy losses on Wall Street, with the Philadelphia Semiconductor Index falling 12.2%.
Timothy Moe, Goldman Sachs' chief Asia Pacific equity strategist, told CNBC's "Squawk Box Asia" on Friday that investors unwinding positions, stop-loss selling and greater volatility had amplified the decline in Asian equities. He also said potential political opposition to data-center construction in the United States could affect demand and profits for Asian companies supplying AI hardware.
Moe linked those prospects to the pace and scale of U.S. development. "The market's tendency is always to shoot first and ask questions later," he said, describing the response as investors reassessed expectations for the buildout.
