The heaviest single loss in Asia on Friday was not in Tokyo. South Korea's Kospi dropped 7.4% to 4,985.99, with Samsung Electronics down 7.9% in morning trading, according to the Associated Press report carried by WSLS.
That detail matters because it points at what was being sold. This was not a Japan story spreading outward; it was a selloff in chip and artificial-intelligence shares that started on Wall Street on Thursday and reached the Asian indexes with the largest technology weightings first.
Key numbers
- 5.7% the Nikkei 225's loss by midday Friday, at 57,576.63, after the index opened more than 6% lower
- 7.4% the Kospi's fall, to 4,985.99, the steepest among the Asian benchmarks reported
- 4.4% the S&P 500's drop on Thursday, to 7,353.73, its worst day since April 2025
- 11.9% how far the Nasdaq composite sat below its all-time high set last month, after closing at 24,315.00
Chip stocks did most of the damage
On Wall Street on Thursday, the Dow Jones Industrial Average sank 1,833.06 points, or 3.4%, to 51,523.06, and the Nasdaq composite lost 1,421.52 points, or 5.5%, WSLS reported. A fall of more than 10% from a high is what markets call a correction, and the Nasdaq was 11.9% below its record.
Nvidia fell 9.3% and was the single heaviest weight on the S&P 500. Advanced Micro Devices dropped 17.3%, CoreWeave 9.8%, and GE Vernova, which supplies power equipment used by data centers, 7.5%.
Two worries sat behind the selling, according to the same report: that the construction of AI data centers may slow because borrowing has become expensive, and that after Tuesday's US midterm elections, in which Democrats won nationwide, governments could force pauses in new data-center construction. Less construction would mean fewer purchases of AI chips, electricity and related services.
In plain words: a handful of chip companies have grown so large that they now dominate the main US indexes. A 1% move in Nvidia shifts the S&P 500 more than a 1% move in almost any other US stock. When those shares fall together, index funds and the Asian markets full of their suppliers fall with them, even when nothing has changed at the smaller companies inside.
The rest of Asia moved far less
Australia's S&P/ASX 200 lost 1.0% to 8,973.00, Hong Kong's Hang Seng fell 0.7% to 24,630.03 and the Shanghai Composite dipped 1.3% to 3,642.10. The gap between those falls and the losses in Tokyo and Seoul tracks how much chip and AI exposure each benchmark carries.
In Tokyo, Toyota shares fell sharply after the automaker reported lackluster profits on Thursday. Nintendo, which also reported the previous day, fell with the wider market. Sony Group, which reported strong results helped by its latest Spider-Man film, slipped slightly.
Away from equities, the 10-year Treasury yield fell to 4.84% from 4.90% late Wednesday, having been at 4.95% on election night and above 5.30% last month. The dollar rose to 157.97 Japanese yen from 157.68. US benchmark crude added 0.65% to $91.11 a barrel and Brent gained 1.4% to $99.73.
The reports do not agree on the size of the drop
I went through the Friday reports on Tokyo, and they describe the same session at different moments. RTTNews put the Japanese market down 6.6%; News On Japan counted a loss of 3,643 points; Japan Herald reported the Nikkei briefly fell more than 7% and below 60,000. WSLS gave the midday level, 5.7% lower.
IBTimes Australia reported that SoftBank and Advantest led the Japanese chip decline and described the index as entering a bear market. None of the other reports I read used that description.