Tech Heavyweights Lead the Decline
Technology stocks bore the brunt of Friday’s selloff, with AI-focused and semiconductor names suffering the steepest losses. SMIC fell nearly 10%, while broader tech heavyweights including Meituan and other platform companies tumbled sharply. The Hang Seng Index briefly dropped more than 600 points during the session before recovering slightly to close down 446 points. Ssundayguardianlive
The weakness extended across the region. Japan’s Nikkei 225 fell below 64,000, entering correction territory roughly 10% off its 12-month highs, while Taiwan’s market also slipped into correction. Mainland Chinese markets declined in tandem, with the Shanghai Composite Index falling 3% and the Shenzhen Component Index dropping 5.4%. Yyoutube
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Wall Street Chip Rout Sets the Stage
The Asian selloff followed consecutive days of semiconductor weakness on Wall Street. On Thursday, the Philadelphia SE Semiconductor Index fell 3.5% even after Taiwan Semiconductor Manufacturing reported strong results. The Nasdaq Composite slipped 0.6% as memory-chip makers led losses, according to Reuters. The Wall Street Journal reported the PHLX Semiconductor index dropped 5% during Wednesday’s session, with Marvell and Western Digital among the biggest decliners. Wwsj
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Investors have grown cautious over whether massive AI infrastructure spending will generate adequate returns, a concern that has dogged the sector intermittently since early July. Escalating geopolitical tensions between Washington and Tehran over the Strait of Hormuz have added to the risk-off mood, pushing oil prices higher and reinforcing inflation fears. Hhome
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Broader Context
Market turnover in Hong Kong reached HK$322.9 billion on Friday, reflecting active participation in the selloff rather than a thin-liquidity air pocket. The decline comes after a volatile stretch for Hong Kong-listed tech shares, which experienced a 36% drawdown between an October peak and a June low before staging a partial recovery. Analysts have pointed to hedge fund deleveraging as a key driver of the chip stock unwind. Wwsj
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