Investing.com– Asian technology stocks fell sharply on Friday, extending recent declines as worries over the slowing artificial intelligence trade were amplified by weak earnings from major U.S. companies.
Chipmaking stocks were the worst hit, with TSMC (TW:2330)– the region’s most valuable company– falling 1.8% in Taiwan trade. Server and electronics assembler Hon Hai Precision Industry, better known as Foxconn, (TW:2317) fell 3%.
South Korea’s Samsung Electronics Co Ltd (KS:005930) fell 5.9%, extending losses after its third-quarter earnings missed some lofty expectations on Thursday, while rival SK Hynix Inc (KS:000660) fell 8.3%.
Japanese chip stocks also fell sharply, with Tokyo Electron Ltd. (TYO:8035) losing over 5% and Murata Mfg Co (TYO:6981) sliding 11% ahead of their September quarter earnings.
Advantest Corp. (TYO:6857) slid 5.8%, reversing strong gains from the prior session after the NVIDIA Corporation (NASDAQ:NVDA) supplier clocked strong quarterly earnings.
Tech conglomerate SoftBank Group Corp. (TYO:9984), which is heavily exposed to AI, dropped nearly 7%.
Japanese stocks were also spooked by a hawkish Bank of Japan, which left interest rates steady but said that inflation had reached its 2% target, opening the door to more interest rate hikes.
The BOJ also signaled a sharp increase in sales of its exchange-traded fund holdings– a move that presents direct pressure on Japanese equities.
Losses in chip shares came tracking an over 20% wipeout in Intel Corporation (NASDAQ:INTC) on Thursday evening, after the U.S. chipmaker’s fourth-quarter guidance largely underwhelmed.
While Intel benefited from increasing demand for data center processors, its PC business faced mounting headwinds from soaring component costs and weakening consumer demand– a trend that has impacted electronics manufacturers across the board.
Doubts over the long-term prospects of AI also surged after top spender Amazon.com Inc (NASDAQ:AMZN) missed top and bottom-line estimates for the September quarter, while its cash flow position fell further into negative territory.
This came following a similarly disappointing print from Google owner Alphabet Inc (NASDAQ:GOOGL) earlier this week, which raised more questions over just how much returns the billions of dollars poured into AI infrastructure will generate.
