Asian Stocks Pare Losses After US Tech-Led Selloff: Markets Wrap
(Bloomberg) — Asian stocks trimmed earlier declines, following a slide in US tech shares, on speculation regional companies have a broader mix of operations that makes them more resilient to the software-driven selloff.
MSCI’s Asian gauge of equities pared an earlier drop of as much as 0.6%, boosted by a rotation into more economically sensitive industries such as financials and industrials. The US losses were driven by increasing concern that the rollout of artificial intelligence will undermine traditional software-service business models.
Elsewhere, oil rose after the US Navy shot down an Iranian drone headed toward an aircraft carrier in the Arabian Sea. The yen weakened as traders adjusted their positions before a Japanese election this weekend.
“While Asia’s tech sector will see some overall pressure, energy and equipment and chip stocks should fare better than software,” said Matthew Haupt, a fund manager at Wilson Asset Management in Sydney. “Hong Kong and China will be under more pressure given their exposure to software names, while Kospi’s reaction today seems quite muted.”
Software stocks dropped from the open in Asia, tracking losses in their US peers, after AI startup Anthropic released a productivity tool for in-house lawyers, indicating it is directly competing against software-as-a-service businesses. That led to a slide in shares associated with legal software and data services, and snowballed to include a broader range of software firms.
The US selloff also spread to alternative investment firms such as Blue Owl Capital Inc. due to speculation AI-driven disruptions would cause steep losses on their books. Wall Street has been skeptical about software companies for a while, but sentiment has worsened as traders sell shares of firms across the industry as fears about the destruction to be wrought by AI pile up.
A growing number of investors are also starting to wager that the surge in AI companies, led by the “Magnificent Seven” megacaps, is giving way to broader market participation. A marked rotation has taken place in 2026, with value shares far outpacing growth.
Oil advanced for a second day as geopolitical tensions resurfaced following the US downing of an Iranian drone near an American aircraft carrier in the Arabian Sea. Brent advanced to around $68 a barrel, after adding 1.6% on Tuesday, while West Texas Intermediate was near $64.
“The drone and tanker skirmishes are highlighting to the market how volatile the situation is, and how things could escalate out of hand even unintentionally,” said Saul Kavonic, senior energy analyst at MST Marquee.
The yen fell as traders positioned ahead of an expected victory by Prime Minister Sanae Takaichi’s Liberal Democratic Party in this weekend’s election.
“A strong showing by the LDP will embolden Takaichi to advance her budget stimulus plans, raising the risk of a larger government debt burden and weighing on Japanese government bonds and the yen,” Carol Kong, a strategist at Commonwealth Bank of Australia, wrote in a note to clients.
Bitcoin rose in Asian trade after dropping to a more-than one-year low on Tuesday. The token’s recent plunge may deepen into a self-reinforcing “death spiral,” inflicting lasting damage on companies that have spent the past year stockpiling the token, investor Michael Burry said.
Corporate Highlights:
Super Micro Computer Inc. shares gained in late trading after the company gave a forecast for sales in the current quarter that signaled strong demand for its gear to run AI data centers. Nvidia Corp. is nearing a deal to invest $20 billion in OpenAI as part of its latest funding round, according to people familiar with the matter, marking the chipmaker’s single biggest investment in the ChatGPT developer. Prudential Financial Inc. announced it would voluntarily suspend new life insurance sales in Japan for 90 days, in a move to restore trust after some former employees engaged in financial misconduct. Banco Santander SA agreed to acquire Webster Financial Corp. in a $12 billion deal that will allow Spain’s largest bank to bet big on the US. A KKR & Co.-led group agreed to buy data center operator STT GDC Pte for S$6.6 billion ($5.2 billion) in cash, marking the latest global deal in digital infrastructure supporting the boom in artificial intelligence. Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 1:04 p.m. Tokyo time Nikkei 225 futures (OSE) fell 0.5% Japan’s Topix rose 0.1% Australia’s S&P/ASX 200 rose 1% Hong Kong’s Hang Seng fell 0.4% The Shanghai Composite was little changed Euro Stoxx 50 futures were little changed Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1827 The Japanese yen fell 0.4% to 156.34 per dollar The offshore yuan was little changed at 6.9338 per dollar Cryptocurrencies
Bitcoin rose 0.5% to $76,553.51 Ether fell 0.2% to $2,278.93 Bonds
The yield on 10-year Treasuries was little changed at 4.27% Japan’s 10-year yield was unchanged at 2.250% Australia’s 10-year yield advanced three basis points to 4.87% Commodities
West Texas Intermediate crude rose 0.9% to $63.81 a barrel Spot gold rose 2.4% to $5,066.49 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Rob Verdonck and Sara Hemrajani.
©2026 Bloomberg L.P.
