Global Stock Markets See Decline Amid Tech Sell-Off
BANGKOK (AP) — Stock markets in Europe and Asia experienced a downturn on Wednesday, following a significant drop in shares on Wall Street, largely driven by declines in major technology companies.
In Asia, markets showed some resilience after initial losses. Tokyo’s Nikkei index, which dipped nearly 5% earlier, managed to close down 2.5% at 50,212.27.
As European markets opened, Germany’s DAX index fell by 0.7% to 23,777.85. Meanwhile, the CAC 40 in Paris decreased by 0.4% to 8,039.32, and Britain’s FTSE 100 slipped slightly by 0.1% to 9,707.18.
Futures for the S&P 500 dipped by 0.1%, while the Dow Jones Industrial Average saw a slight uptick of 0.1%.
The effects of Wall Street’s sell-off were clear. Shares in SoftBank Group, known for its investments in technology, dropped 10%. Additionally, computer chip manufacturer Tokyo Electron fell by 4.1%, and Advantest, which provides semiconductor testing equipment, saw a decrease of 6%.
In auto news, Toyota Motor Corp. reported a 7% decline in profits for the April to September period, yet it raised its earnings forecast for the year despite potential impacts from higher tariffs on imports of vehicles and parts in the U.S. Its shares fell by 3.7%.
South Korea’s Kospi index fell 2.9% to 4,004.42, driven by a 4.1% decline in Samsung Electronics. Similarly, SK Hynix, which had previously benefited from partnerships in artificial intelligence, experienced a 1.2% drop.
Chinese markets showed mixed results; the Shanghai Composite index edged up by 0.2% to 3,969.25, while Hong Kong’s Hang Seng index saw a slight decline of 0.1% to 25,935.41.
The heavy selling of tech shares on Wall Street has made investors anxious. The tech sector has been a major driver of market growth this year, with companies like Nvidia and Microsoft having a substantial influence on overall market trends.
In commodity news, gold prices rose by 0.8% to $3,990.90 an ounce, a typical move during uncertain times.
Stephen Innes from SPI Asset Management noted, “The rally that started in April is showing signs of fatigue. What we’re witnessing today isn’t just a minor dip; it feels like a reality check for the market.”
Palantir Technologies, which provides data software solutions, saw its shares fall by 7.9% despite posting better-than-expected results. Nvidia and Microsoft also faced declines, with Nvidia falling 4% and Microsoft down by 0.5%.
Overall, the S&P 500 index dropped 1.2% but remains up over 15% this year. The Dow Jones Industrial Average fell by 0.5%, and the tech-heavy Nasdaq index decreased by 2%.
Wall Street is currently focused on quarterly corporate earnings. Approximately 75% of S&P 500 companies have reported their earnings, and most have surpassed expectations. Major companies like McDonald’s, Expedia Group, and Qualcomm will share their financial results later this week.
The backdrop of a U.S. government shutdown has further heightened the importance of these earnings reports, as investors seek insight into the economy’s health without recent data on inflation and employment.
In other market news, Tesla shares dropped 5.1% following a statement from Norway’s sovereign wealth fund, a major investor, indicating it would oppose a proposed compensation package for CEO Elon Musk that could be worth $1 trillion over a decade.
Crude oil prices saw a slight drop, with U.S. benchmark crude at $60.42 per barrel and Brent crude at $64.29 per barrel. The dollar fell to 153.53 Japanese yen, while the euro increased to $1.1495.
