Investing.com-- Asian stock markets fell on Monday, led by sharp declines in South Korean and Hong Kong shares, as an AI-driven sell-off gathered pace in line with weak Wall Street sentiment, while investors digested mixed signals from China’s latest factory activity data.
The pullback tracked losses in Wall Street futures during Asian hours, with tech-heavy Nasdaq futures slipping 1% amid concerns that enthusiasm around artificial intelligence may have run ahead of fundamentals.
KOPI slumps over 5%, Hang Seng drops 2.5%
South Korea’s KOSPI slumped more than 5%, weighed down by losses in heavyweight chipmakers -- Samsung Electronics (KS:005930) and SK Hynix (KS:000660) dropping between 4.8% and 6.5%.
Hong Kong’s Hang Seng index declined 2.5%, with the Hang Seng TECH sub-index losing more than 3%.
Elsewhere in the region, markets were broadly weaker, reflecting a cautious start to the week after last week’s declines in U.S. equities.
Sentiment toward AI-linked shares has deteriorated following recent U.S. earnings, including results from Microsoft Corporation (NASDAQ:MSFT), which highlighted rising costs tied to heavy AI investment and raised questions about near-term returns.
The outlook for the sector remains in focus this week, with earnings due from Amazon and Alphabet, both seen as bellwethers for cloud computing and AI-related demand.
Adding to the cautious mood, U.S. President Donald Trump nominated Kevin Warsh to be the next chair of the Federal Reserve. Warsh, a former Fed governor, has a long track record of emphasising inflation risks and has historically been viewed as relatively hawkish on monetary policy.
Traders weigh mixed China PMI figures
Data released on Saturday showed that China’s official manufacturing PMI slipped further below the 50 mark in January, pointing to a contraction in factory activity and highlighting persistent weakness in domestic demand.
In contrast, the RatingDog private manufacturing PMI, which focuses more on smaller, private firms, edged back into expansion territory, offering a more optimistic view of export-oriented sectors.
In mainland China, the blue-chip Shanghai Shenzhen CSI 300 fell 1.1%, while the Shanghai Composite declined 1.3%, amid a broader regional downturn.
Japan's Nikkei 225 dropped 1%, while the broader TOPIX index edged 0.3% lower.
Australia's S&P/ASX 200 slipped 1.3%, while Singapore's Straits Times Index eased 0.3%.
Futures for India's Nifty 50 traded flat at open.


































