Asian markets fall as AI stock sell-off intensifies; Nikkei fell almost 6%, HSI fell 2%

Asian shares fell into the red on Friday as fears over artificial intelligence intensified, with Japan and Taiwan recording the steepest declines. Additionally, rising tensions in the Middle East also kept investors cautious, pushing oil prices higher while US futures traded lower.Japan’s Nikkei 225 led regional losses, falling 5.8% to 62,945.97 after computer chip makers and other artificial intelligence-related companies witnessed broad selling. Taiwan’s index also fell more than 5% while trading in South Korea remained closed.Elsewhere in the region, Hong Kong’s Hang Seng Index fell 2% to 24,514.29, China’s Shanghai Composite fell 1.6% to 3,818.59 and Australia’s S&P/ASX 200 lost 0.7% to close at 8,775.70.The weakness in artificial intelligence stocks reflects growing investor concern that the sector’s sharp growth may have outpaced fundamentals. Markets are also weighing whether demand for advanced computer memory and processors will remain strong if artificial intelligence fails to deliver the profits and productivity gains many investors expected. Meanwhile, Indian shares were trading higher, with benchmark indices gaining nearly 1%. Around 11:30 IST, the BSE Sensex was trading at 77,903.91, while the NSE Nifty50 crossed the 24,250 level.Cautious sentiment followed a mixed session on Wall Street. While nearly three-quarters of S&P 500 companies rose after reporting quarterly profits that beat analysts’ expectations, losses in major technology stocks dragged the broader market lower. The S&P 500 fell 0.5%, the Dow Jones Industrial Average fell 0.2% and the Nasdaq Composite fell 1.5%.Among individual stocks, Nvidia fell 2.4%, the biggest drag on the S&P 500. Other companies riding the artificial intelligence wave also pulled back.Micron Technology shares fell 5.6%, putting its profit for the year below 199%. SanDisk shares fell 12.6%, although they remain up 494% this year, while Western Digital lost 9.2% but are still up 171% for the year.In commodity markets, oil prices continued to rise as investors monitored the escalation of conflict in the Middle East. Fears that a war with Iran could disrupt tanker traffic through the Strait of Hormuz and interrupt crude oil exports from the Persian Gulf continued to support prices.Brent crude rose 1.1% to $85.13 a barrel and U.S. benchmark crude rose 1.3% to $79.95 a barrel.