AI chip rout spreads to Asia after Democratic sweep

A global selloff in artificial intelligence and semiconductor stocks hit Asia on Friday, erasing more than $18 billion from the fortunes of the region's richest technology tycoons. Investors are betting that Democrats, who won both chambers of Congress in Tuesday's midterm elections, will tighten AI rules and slow the construction of data centers.

The rout came after a record one-day wipeout on Wall Street. On Thursday the Nasdaq 100 sank 6.4%, erasing $2.3 trillion in market value, the most on record. The S&P 500 ↗ 2.37% fell 4.4%, its biggest drop since the April 2025 tariff shock, Bloomberg reported.news.bloomberglaw.com

Billionaires take the hit

By 10 a.m. Hong Kong time, 22 billionaires from China, Japan, Taiwan and South Korea had lost more than $21 billion combined. That loss later narrowed to more than $18 billion, according to the Bloomberg Billionaires Index. SoftBank Group founder Masayoshi Son lost the most. His fortune fell $3.9 billion to about $29 billion.finance.yahoo.com

Keyence founder Takemitsu Takizaki lost at least $1 billion, as did Jason Chang of chip packager ASE Technology ↗ 8.63%. Samsung Electronics chairman Jay Y. Lee, his mother and his sister lost about $2.5 billion together, Bloomberg said. Brokers from Taiwan to Hong Kong issued margin calls to wealthy clients holding leveraged bets.finance.yahoo.com

Chip-heavy markets slide

Before the open, futures for South Korea and Taiwan were down at least 7% and those for Japan nearly 6%, according to Bloomberg. South Korea's Kospi fell as much as 8.8% early in the day, which triggered a 20-minute trading halt, the BBC reported. Both the Kospi and Japan's Nikkei 225 closed 6% lower, and Taiwan's Taiex ended down 4.5%, CNN reported.finance.yahoo.com+2

SK Hynix fell more than 10% and Samsung dropped 6.4%. SoftBank lost more than 10%, Kioxia and Advantest also fell, and TSMC Taiwan Semiconductor Manufacturing Company Limited ↗ 3.51% dropped 4.7%, according to AFP. Losses were smaller in Hong Kong's Hang Seng and in Shanghai.afp.com

Fears over data center limits

Markets first welcomed the "blue wave" on hopes it would push President Donald Trump to wind down the war with Iran. Worries about AI spending soon took over. Many winning candidates have promised to slow data center projects, and Senator Bernie Sanders has called for a national moratorium on building them, AFP noted. The Philadelphia Semiconductor Index PHLX Semiconductor Sector Index ↗ 7.03% has dropped nearly 16% this week, on pace for its worst week since April 2025, Bloomberg reported. The slide also pushed Nvidia CEO Jensen Huang out of the world's 10 richest people.sg.finance.yahoo.com+1

Trump blamed Democrats for the crash in a post on Truth Social Trump Media & Technology Group Corp. ↗ 1.75%. Neil Wilson of Saxo Markets told AFP the move "looks totally overdone but the nature of sell-everything of this market means we need to look for some stability first."afp.com