Markets
Asian Chip Stocks Sink as Kospi Falls More Than 5% on Worries a Democratic Congress Could Curb AI Spending
Image: ElasticComputeFarm via Pixabay
Samsung, SK Hynix and Japanese chip-gear makers lead losses while Hong Kong, Australia and Europe rise and US futures are mixed.
By Emmanuel Cruz ·
Asian technology stocks were hit hard on Thursday as investors weighed what a Democratic-controlled Congress could mean for the artificial intelligence build-out, even as broader indexes in Hong Kong, Australia, India and Europe moved higher. South Korea's Kospi fell 5.3% to 5,383.80, according to the Associated Press report published at 6:08 a.m. Eastern Time [1].
The damage was concentrated in chip names. Samsung Electronics dropped 7.6% and SK Hynix fell 9.4%. In Japan, Tokyo Electron lost 9.5%, Advantest sank 15% and SoftBank Group slid 6.9%, and the Nikkei 225 fell 1.8% at 61,077.90 [1]. Taiwan's Taiex was down 3.2% [1].
Seoul's session had opened at 5,580.09, down 103.71 points from the prior close, and by 10 a.m. local time had slipped further to the 5,500 range, SBS News reported. The broadcaster pointed to a decline in the US semiconductor index and to worries that stricter rules on AI data centers could follow the Democratic Party's strong midterm showing. Foreign investors sold more than 860 billion won of shares in early trading, while retail investors bought more than 720 billion won [2].
The AP said investors are assessing how a Democratic-led Congress, which takes office in January, could affect the AI boom. Ipek Ozkardeskaya of Swissquote said a Democratic win could complicate an AI investment story that already faced doubts about "massive spending" [1]. It is worth noting that the reaction reflects market speculation about future policy; the reports do not describe any specific legislation.
Elsewhere in the region the picture was far brighter. Hong Kong's Hang Seng gained 3.7% to 24,796.98, Australia's S&P/ASX 200 rose 2.6% to 9,065.10, India's Sensex climbed 2.8% and China's Shanghai Composite edged up 0.1% to 3,689.91 [1]. In early European trading, Germany's DAX was up 0.6% at 26,598.03, France's CAC 40 gained 1.2% at 8,276.55 and the UK's FTSE 100 rose 1% to 10,935.08 [1].
The moves follow a strong Wall Street session on Wednesday, when the Dow Jones Industrial Average rose 3.03% to close at 53,356.12 and the S&P 500 gained 1.58%, according to TipRanks [3]. US futures were mixed early Thursday. As of 5:25 a.m. Eastern, Nasdaq-100 futures were down 0.53%, S&P 500 futures were up 0.05% and Dow futures were up 0.49% [3]. The weakness in Nasdaq futures lines up with the tech selloff in Asia and with a sharp after-hours decline in Qualcomm shares after its results [3].
Energy markets were calmer after Wednesday's steep drop. Brent crude, which fell 8.7% on Wednesday to $94.62 a barrel, edged up to $95.04 in early Thursday trading, while the dollar slipped to 158.22 Japanese yen from 158.41 and the euro rose to $1.1241 [1].
What to watch: whether the chip selloff spreads to US semiconductor stocks at the open, how Korean and Japanese markets hold up after such a large one-day drop, and whether Washington signals any concrete plans for AI data-center rules. Weekly US jobless claims are also due later on Thursday, and the Bank of England announces its rate decision at noon London time [3].
Sources:
[1] The Associated Press (via CP24), "World shares mostly gain after U.S. midterm elections as AI-related stocks sink", November 5, 2026. https://www.cp24.com/news/money/2026/11/05/world-shares-mostly-gain-after-us-midterm-elections-as-ai-related-stocks-sink/
[2] SBS News, "KOSPI Slips to 5,500 Range in Early Trading Amid Semiconductor Share Drop; Samsung Electronics and SK Hynix Plunge 5% to 7%", November 5, 2026. https://news.sbs.co.kr/english/article.do?news_id=N1008831831
[3] TipRanks, "Stock Market Today, Nov. 5: Futures Mixed After Democratic Victory Sparks Wall Street Rally", November 5, 2026. https://www.tipranks.com/news/stock-market-today-nov-5-futures-mixed-after-democratic-victory-sparks-wall-street-rally
This article was produced with AI assistance. It is for informational purposes only and is not financial advice. StockVolt and its authors may hold positions in securities mentioned.