AI spending hits Asian tech markets

In late July 2026, global equity markets pulled back as investors reacted to massive AI‑related capital expenditures by leading U.S. tech firms. The slide began on July 22 with modest declines across Asian benchmarks amid rising oil prices and renewed U.S.–Iran tension.

By July 27 the sell‑off focused on Asian technology stocks. The debut of China’s ChangXin Memory Technologies sparked fears of fierce competition in the memory‑chip sector. South Korea’s KOSPI plunged more than 10% and was temporarily halted, while Japan’s Nikkei and Taiwan’s index each fell 3‑4%. Major chipmakers such as Samsung, SK Hynix, Nvidia and ASML recorded double‑digit losses, and Japan’s 30‑year government‑bond yield approached a record near 4%.

Further details from the same day showed ChangXin’s stock soaring nearly 500% on its IPO before retreating, and reports that China had begun producing deep‑ultraviolet lithography machines previously dominated by Dutch firm ASML. Alphabet dropped 10% after announcing higher AI capex, and the yen slipped to a 40‑year low. Economist Peter Schiff warned that Japan’s large Treasury holdings could face selling pressure, adding to market unease.

Together, these snapshots trace a progression from an initial, broad market pullback linked to AI spending and geopolitics to a sharp, sector‑specific rout driven by competitive pressures in AI‑related semiconductor manufacturing and tightening bond‑market conditions in Japan.