BANGKOK – Asian shares skidded Friday, with Tokyo’s Nikkei 225 down more than 5% as heavy selling of computer chipmakers and other AI-related shares dragged markets lower.
South Korean markets were closed Friday, but shares in Taiwan fell 5.9% a day after TSMC, the world's biggest contract manufacturer of computer chips, announced it plans to spend an extra $100 billion on building fabrication plants in the U.S.
Recommended Videos
TSMC dropped 6.1% on Friday.
Stocks related to artificial intelligence have been under pressure for weeks because of worries that their prices have shot too high and that voracious demand for computer memory and processors may not be sustainable if AI ends up not producing as much profit and productivity as promised.
Oil prices surged as fighting in the Middle East intensified, while U.S. futures slipped.
The United States expanded its airstrike campaign against Iran early Friday by hitting more bridges and apparently collapsing a tower at a key Iranian port, part of U.S. President Donald Trump’s threats to start striking infrastructure to pressure Tehran to ease its chokehold on the Strait of Hormuz.
The Nikkei lost 5.3% to 63,357.19, trading near its lowest levels in over a month, as shares in computer chip equipment maker Tokyo Electron sank 9.3%. Chip testing equipment maker Advantest tumbled 10.5%.
SoftBank Group shed 11.4%.
The Hang Seng in Hong Kong gave up 2.2% to 24,450.88, while the Shanghai Composite index was 1.6% lower at 3,818.59.
In Australia, the S&P/ASX 200 declined 0.7% to 8,775.70.
“Now investors are taking profits from the first-half winners and moving toward areas that were left behind,” Stephen Innes, of SPI Asset Management, said in a commentary.
On Thursday, the S&P 500 fell 0.5% even though nearly three out of every four stocks in the index rose after more of the country’s biggest companies reported better earnings for the latest quarter than analysts expected.
The Dow Jones Industrial Average dipped 0.2%, and the Nasdaq composite lost 1.5%.
Nvidia fell 2.4%, making it the heaviest weight on the index. Other stocks that have benefited from strong demand for AI also sank, giving back some of their stellar gains.
Micron Technology fell 5.6% to shave its gain for the year so far below 199%. SanDisk fell 12.6% but is nevertheless up 494% for the year. Western Digital sank 9.2% but is still up 171% for the year.
Oil prices are near their highest level in a month because of worries that the war with Iran will keep oil tankers out of the Strait of Hormuz and block shipments of crude from the Persian Gulf to customers worldwide.
The price for a barrel of Brent crude, the international standard, rose 1.1% to $85.13 per barrel.
U.S. benchmark crude oil was up 1.3% at $79.95 per barrel.
Reports on the U.S. economy Thursday came in mixed. One said shoppers spent less at U.S. retailers last month than economists expected.
A separate report said fewer U.S. workers applied for unemployment benefits last week, an indication of a solid job market, while a third report said manufacturing in the mid-Atlantic region is better than economists expected.
In other dealings early Friday, the U.S. dollar rose to 162.43 Japanese yen from 162.38 yen. The euro slipped to $1.1438 from $1.1443.