Markets in US and Asia Fall Amid AI Fears

Financial markets in the US and Asia have fallen sharply as investors sell off shares in technology companies, with artificial intelligence, AI, stocks hit particularly hard.

In Wednesday’s trading in New York, the S&P 500 lost 2.3 per cent and the tech-heavy Nasdaq fell 3.6 per cent, in their biggest one-day falls since 2022. The Dow Jones Industrial Average dropped by 1.2 per cent.

The losses were driven by major firms including Nvidia, Alphabet, Microsoft, Apple and Tesla.

On Thursday, Japan’s Nikkei index led declines in Asia as it fell by more than 3 per cent.

Shares in technology companies, especially those related to AI, have driven much of this year’s stock market gains.

AI chip giant Nvidia, which has been one of the main beneficiaries of the AI boom, saw its shares drop 6.8 per cent. It has lost about 15 per cent of its value in the last two weeks.

The company is set to report financial results at the end of August.

Shares in multi-billionaire Elon Musk’s electric car maker Tesla dropped by more than 12 per cent after its latest financial results disappointed investors.

Google and YouTube parent company Alphabet’s stock price was 5 per cent lower.

Earlier this week, the company reported financial results that beat analyst expectations but said its spending would stay high for the rest of 2024.