HONG KONG (AP) — Asian stocks plunged Wednesday after Wall Street had its worst day since early August, with heavyweight Nvidia falling 9.5%, leading to a global rout in chip-related stocks.
Japan’s benchmark Nikkei 225 index shed 3.8% to 37,211.09 points, leading losses in Asia. Electronics and semiconductor company Tokyo Electron plunged 7% in morning trading. South Korea’s Kospi fell 3.0% to 2,584.81 points, and tech giant Samsung Electronics dropped 3.1%. Taiwan’s Taiex lost 4.0%, dragged down by heavyweight Taiwan Semiconductor Manufacturing Company, which fell 4.7%.
Australia’s S&P/ASX 200 fell 2.1% to 7,933.40 points after data on Wednesday showed the country’s GDP grew 1% compared with the second quarter of 2023, slightly above analysts’ forecasts. Hong Kong’s Hang Seng Index fell 1.1% to 17,462.25 points and the Shanghai Composite Index fell 0.5% to 2,789.39 points.
U.S. futures fell. Rising oil supplies were pushing prices lower as Libya moved closer to resolving a dispute over control of the country’s oil revenues, meaning its oil output could soon rise.
Benchmark U.S. crude fell 45 cents to $69.89 a barrel. Brent crude, the international standard, lost 42 cents to $73.33 a barrel.
Growing concerns about the economy of China — the world’s largest importer of crude oil — also amplified doubts about future oil demand, especially after the recent release of weak data, which was weighed down by a slump in the property market and weak consumption.
S&P 500 heavyweight Nvidia fell 9.5% on Tuesday. Its shares have been struggling even after the chip company beat lofty expectations for its latest earnings report. The subdued performance could reinforce criticism that Nvidia and other Big Tech stocks simply got too carried away in the Wall Street frenzy around artificial intelligence technology. Global semiconductor-related stocks fell on Wednesday.
On Tuesday, the S&P 500 sank 2.1%, giving up some of the gains from a three-week winning streak that had taken it to the brink of its all-time high. The Dow Jones Industrial Average fell 626 points, or 1.5%, from its own record set on Friday ahead of Monday’s Labor Day holiday. The Nasdaq Composite dropped 3.3% as Nvidia and other Big Tech stocks led the decline.
Treasury yields also wobbled in the bond market after a report showed the U.S. manufacturing sector contracted again in August, reeling under the weight of high interest rates. The manufacturing sector has been contracting for most of the past two years, and its performance in August was worse than economists had expected.
“Demand remains subdued as businesses show an unwillingness to invest in capital and inventory due to ongoing federal monetary policy and election uncertainty,” said Timothy Fiore, chairman of the Institute for Supply Management’s manufacturing business survey committee.
Other reports later this week could show how much help the economy needs, including updates on how many jobs U.S. employers announced at the end of July and how much U.S. service businesses grew last month. The highlight of the week will likely come Friday, when a report will be released showing how many jobs U.S. employers added during August.
Overall, the S&P 500 fell 119.47 points to 5,528.93. The Dow Jones fell 626.15 points to 40,936.93, and the Nasdaq Composite dropped 577.33 points to 17,136.30.
In the bond market, the yield on 10-year Treasury notes fell to 3.84% from 3.91% late Friday. That represents a drop from 4.70% at the end of April, a significant move for the bond market.
On the foreign exchange market, the US dollar remained virtually unchanged at 145.48 Japanese yen. The euro was worth 1.1054 dollars, compared with 1.1043 dollars the previous day.
___
AP Business Writer Stan Choe contributed.