Asian stocks delivered mixed performances on Thursday as a sharp semiconductor selloff pushed South Korea’s KOSPI index down more than 5%, triggering temporary trading restrictions.
Japanese technology shares also suffered heavy losses following disappointing updates from US chipmakers Qualcomm and Arm Holdings.
However, Chinese equities outperformed regional markets, supported by government stimulus measures and renewed investor interest in domestic semiconductor companies.
Meanwhile, falling oil prices and the Democratic Party’s victory in the US midterm elections helped improve sentiment across several other Asian markets.
KOSPI Plunges 5.3% as Semiconductor Selloff Triggers Trading Curbs
South Korea’s KOSPI index closed 5.3% lower on Thursday as investors aggressively sold semiconductor and technology stocks.
The sharp decline triggered a temporary sell-side program-trading restriction earlier in the session, reflecting significant market volatility.
Samsung Electronics (KS:005930), one of South Korea’s largest listed companies, dropped 7.6%.
Meanwhile, memory chip manufacturer SK Hynix (KS:000660) plunged 9.5%, contributing heavily to the broader market decline.
The selling pressure followed quarterly earnings announcements from US semiconductor companies Qualcomm (NASDAQ) and Arm Holdings (NASDAQ).
Their financial updates raised concerns about weaker smartphone demand, rising memory costs, and uncertainty surrounding future semiconductor industry growth.
Additionally, the Philadelphia Semiconductor Index declined 3.1% overnight, reaching its lowest level in six months.
These developments intensified concerns about whether substantial investments in artificial intelligence infrastructure will generate sustainable financial returns.
Japanese Chip Stocks Suffer Heavy Losses
Japan’s technology sector also experienced significant selling pressure as semiconductor-related stocks extended their recent declines.
The Nikkei 225 index finished 1.7% lower, although the broader TOPIX index advanced 1.2%.
Among individual companies, semiconductor testing equipment manufacturer Advantest (TYO:6857) plunged 14.7%.
Lasertec (TYO:6920) recorded a similarly steep decline of 14.2%, while memory chip producer Kioxia Holdings (TYO:285A) lost more than 13%.
Technology investment group SoftBank (TYO:9984) also came under pressure, with its shares falling 7%.
The widespread weakness highlighted growing investor concerns about semiconductor valuations and the profitability of AI-related investments.
Furthermore, uncertainty surrounding future technology spending has encouraged investors to reassess companies with significant exposure to the global chip industry.
Chinese Stocks Rally as Beijing Supports Semiconductor Industry
In contrast to South Korea and Japan, Chinese stocks recorded gains as government support measures helped strengthen investor confidence.
The CSI 300 index, which tracks major companies listed in Shanghai and Shenzhen, increased 0.3%.
Meanwhile, the Shanghai Composite Index edged up 0.1%.
Hong Kong’s Hang Seng Index delivered a stronger performance, surging 3.6% as Chinese semiconductor companies attracted renewed buying interest.
The rally followed a decision by the People’s Bank of China to reduce borrowing costs under its financial market support program.
Specifically, the central bank lowered the interest rate on its relending facility for share repurchases and stock purchases by 25 basis points to 1%.
The measure aims to encourage investment activity and provide additional support to domestic equity markets.
China’s Semiconductor Independence Strategy Boosts Sentiment
Chinese chipmakers also benefited from Beijing’s ongoing efforts to reduce dependence on American semiconductor technology.
Government initiatives supporting domestic chip designers, manufacturing facilities, and equipment suppliers have strengthened expectations for long-term industry development.
As a result, several Chinese semiconductor companies outperformed their regional competitors despite the broader technology selloff.
The contrasting performance demonstrates how domestic economic policies and government support can influence stock market movements across Asia.
Oil Prices Plunge as US Midterm Elections Raise Iran Peace Hopes
Lower energy prices provided some relief to Asian financial markets following Wednesday’s substantial crude oil selloff.
Brent crude futures declined 8.7% to settle at $94.62 per barrel.
Similarly, US West Texas Intermediate crude dropped 8.3% to $88.12 per barrel.
Both benchmarks reached their lowest levels in approximately two months.
The sharp decline followed the Democratic Party’s victories in the US midterm elections, which raised expectations of increased political pressure on President Donald Trump to pursue a diplomatic resolution to the conflict with Iran.
Investors anticipate that a potential easing of hostilities could reduce the risk of energy supply disruptions.
Consequently, lower oil prices helped ease inflation concerns and supported market sentiment outside the technology sector.
Australian Stocks Jump as Trade Surplus Beats Expectations
Australia’s stock market recorded substantial gains, supported by stronger-than-expected international trade figures.
The S&P/ASX 200 index climbed 2.6% after official data revealed a significant improvement in the country’s trade balance.
Australia’s seasonally adjusted goods trade surplus increased to A$2.83 billion in September, compared with A$184 million in August.
The result comfortably exceeded economists’ forecasts of A$940 million and marked the largest surplus in seven months.
The stronger trade performance encouraged investor confidence in Australia’s economic outlook.
Elsewhere in Asia, Singapore’s Straits Times Index advanced 0.5%, while India’s Nifty 50 gained 2%.
These increases helped offset some of the regional weakness caused by the semiconductor selloff.
US Stock Futures Mixed as Nasdaq Faces Selling Pressure
US stock futures showed mixed movements during Asian trading hours on Thursday.
As of 07:18 GMT, Nasdaq 100 futures led declines, reflecting continued weakness in technology-related investments.
The cautious performance followed gains on Wall Street during the previous session, when investors welcomed the Democratic Party’s election victory.
Market participants viewed the results as potentially reducing political uncertainty and creating greater pressure for changes in US fiscal and foreign policy.
However, concerns about semiconductor industry earnings and AI investment returns continued to weigh on technology shares.
Falling Treasury Yields and Weaker Dollar Support Markets
The decline in crude oil prices also influenced expectations surrounding US monetary policy.
Lower energy costs could help reduce inflationary pressures, potentially limiting the need for additional interest rate increases by the Federal Reserve.
Investors consequently reduced some expectations for further monetary tightening.
US Treasury yields declined across different maturities, while the dollar weakened against major international currencies.
These developments provided support for risk-sensitive investments and several Asian equity markets outside the semiconductor sector.
However, the impact remained uneven, with technology stocks continuing to face significant selling pressure.
Asian Stock Market Outlook: Semiconductor Risks Remain in Focus
The latest trading session highlighted a growing divergence between Asian stock markets.
South Korean and Japanese technology companies suffered substantial losses as concerns about semiconductor earnings, AI spending, and future profitability intensified.
Meanwhile, Chinese stocks benefited from government support measures, while Australian equities advanced following stronger economic data.
Lower oil prices and declining US Treasury yields also helped improve the broader financial environment.
Looking ahead, investors will monitor upcoming semiconductor earnings, artificial intelligence investment trends, Federal Reserve policy expectations, and geopolitical developments involving Iran.
Although favorable economic conditions could support regional equities, uncertainty surrounding technology sector valuations may continue driving volatility across Asian stock markets.
