Asia tech stocks drop after Broadcom rattles AI trade and drags Wall Street names lower
Asian tech stocks fell Friday after Broadcom’s earnings miss triggered a sell-off in AI-linked firms, with South Korea’s chipmakers like Samsung Electronics and SK Hynix dropping over 7%. The decline spread across Japan and Taiwan, though TSMC remained slightly positive amid broader sector weakness tied to U.S. semiconductor losses.
Asian tech shares declined Friday following a drop in U.S. chip stocks after Broadcom reported weaker-than-expected second-quarter revenue, causing a shift away from AI-related investments. South Korea’s chip-heavy market led losses, with Samsung Electronics falling nearly 7% and SK Hynix dropping over 8%. Other tech-related stocks also weakened: Samsung SDI lost over 7%, LG Display fell 7.4%, LG Innotek declined 6.1%, and Seoul Semiconductor dropped more than 6%. In Japan, tech stocks followed the downward trend, with Tokyo Electron and Advantest losing over 6% and 5% respectively. Murata Manufacturing, a manufacturer of electronic components, fell 4.8%, while Fanuc, a maker of industrial robotics, lost 4.1%. Taiwan saw declines in Apple suppliers, including Hon Hai Precision Industry (down 1.7%) and Pegatron (down 2.6%), while Largan Precision, a producer of iPhone camera lenses, fell over 4%. The only exception was TSMC, which edged up 0.4% despite the broader sector decline. The sell-off originated in the U.S., where Broadcom’s 12% drop after missing revenue targets triggered a broader sector correction. The VanEck Semiconductor ETF fell over 1%, Arm Holdings lost more than 4%, and Micron Technology slid nearly 8%. Analysts noted the need for a market reset after recent gains in AI-linked stocks. The weakness in U.S. chip stocks spread to Asian markets overnight, deepening losses in tech-heavy regions.
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