A technology-stock selloff that began with Monday's Nasdaq collapse cascaded across global markets Tuesday, hammering Asian chip giants before spreading to Europe and US futures. The rout deepened as investors grew anxious about the scale of debt-funded artificial intelligence spending by Big Tech.
South Korea's Kospi index plunged 10%, dragged down by SK Hynix and Samsung Electronics – the two stocks that had powered the market's rally this year. In Japan, the Nikkei 225 dropped 3.55%, while Kioxia, the country's most valuable listed company, sank more than 14%. The selloff hit European stocks shortly after opening: the Stoxx Europe 600 fell 1.2%, and its technology sub-index cratered 3.2%. STMicroelectronics and Dutch equipment maker ASML each slid more than 7%.
US equity-index futures fell for a second day. Nasdaq 100 futures lost 2.7%; S&P 500 futures shed 1.4%. In premarket trading, the iShares Semiconductor ETF was down 5.9%. Individual names were pummeled: Micron fell about 7%, SanDisk 8%, Intel 7%, and AMD 6%. Alphabet, which tumbled Monday after key AI talent left the company, lost another 2%. Nvidia dropped 2.9%. SpaceX, which had plunged 16% in regular trading Monday – wiping out $400 billion in market value in a single day – opened lower again Tuesday before reversing higher to trade at $157 a share.
“This move is closer to a sentiment-driven correction than a fundamental shift in artificial intelligence or corporate earnings,” said Daniela Hathorn, senior market analyst at Capital.com. “But it shows how dependent market leadership has become on a small group of growth-focused companies.”
The trigger, according to Reuters, is mounting concern that hyperscale cloud providers are borrowing heavily to fund AI infrastructure spending. Higher US interest rate expectations compound the worry: if borrowing costs stay elevated, debt-servicing burdens could squeeze even the largest tech firms. Ipek Ozkardeskaya, senior market analyst at Swissquote Bank, noted that SpaceX is not yet included in the Nasdaq index, but the broader pattern is clear – markets are repricing risk in the AI trade.
What to watch now: US economic data and Federal Reserve commentary later this week will test whether this is a sharp but short-lived correction or the start of a deeper rotation out of tech. Traders should also monitor any updates on hyperscaler capital expenditure plans – those numbers will either confirm or defuse the debt-spending narrative.
Global tech stocks plunge amid fears over heavy AI spending and rising debt
Technology stocks fell sharply worldwide as investors worried that large AI investments funded by debt could hurt profits. This selloff affects major chipmakers and tech companies in Asia, Europe, and the US, raising concerns about market stability.