Asian stock markets fell on Thursday, following another rough day on Wall Street, as investors continue to worry about the tech sector — especially the massive money being poured into artificial intelligence.
Any hope for a strong year-end rally has taken a hit. Last week, the U.S. Federal Reserve hinted it might pause interest rate cuts next month. At the same time, more investors are asking tough questions about whether all the cash going into AI will actually pay off.
The Fed has cut rates three times this year, which helped push stocks higher in recent months. But now there’s growing concern that this support could slow or stop.
Later Thursday, fresh U.S. inflation data is expected, which could give markets a better idea of what the Fed plans next. A recent jobs report didn’t give much clarity, so investors remain unsure.
Attention has shifted back to tech stocks, where fears of a bubble are growing.
Tech companies — especially software and chip makers — have driven markets to record highs this year. But more investors are starting to wonder if prices have gone too far, too fast. Many are asking a simple question: when will AI investments actually start making real money?
Those worries got worse on Wednesday after reports said private investment firm Blue Owl pulled out of Oracle’s planned $10 billion data center project, putting it in doubt.
This came just days after Oracle and chip giant Broadcom posted disappointing earnings.
Oracle shares dropped more than 5% on Wednesday. Broadcom also fell, along with other big tech names like Nvidia, Alphabet, and AMD. The tech-heavy Nasdaq slid 1.8%, while the broader S&P 500 fell more than 1%.
Michael Hewson from CMC Markets said the sharp rise in tech stock prices has sparked fears of a bubble, with big price swings in recent weeks as investors take profits before the year ends. He added there’s growing talk that 2026 could bring a reset — separating AI winners from losers.
Asian markets followed Wall Street lower.
Tokyo dropped more than 1%, with losses also seen in Seoul. Markets in Hong Kong, Sydney, Singapore, Wellington, Taipei, Manila, and Jakarta all traded lower. Shanghai was the exception, staying mostly flat.
Meanwhile, oil prices climbed for a second straight day, rising more than 1%.
Prices moved higher after Washington said U.S. forces struck a vessel in the Pacific Ocean that it claimed was involved in drug trafficking, killing four people described as “narco-terrorists.”
Oil also got a boost from rising concern over President Donald Trump’s stance on Venezuela. He recently ordered a blockade of oil tankers linked to sanctions, raising fears of tighter global supply. Venezuelan President Nicolas Maduro says the U.S. is really aiming for regime change, not just stopping drug trafficking.
In short, markets are nervous. Tech stocks are under pressure, AI spending is under scrutiny, and investors are waiting for clearer signals from the Fed — all while geopolitical tensions add another layer of uncertainty.
