Tech Selloff Hits Global Markets as AI Investment Fears Grow

Global equity markets faced renewed selling pressure on October 30, 2026, as disappointing technology earnings intensified concerns about artificial intelligence investment and prompted investors to seek safer assets. The downturn hit US technology futures particularly hard, while questions mounted over the economic dependence of South Korea and Taiwan on continued AI infrastructure spending.

Nasdaq 100 futures dropped 2.2% following earnings reports from Amazon.com Inc. and Intel Corp. Amazon shares fell 7.3% in extended trading, while Intel plunged 23%, according to Bloomberg. Both companies' results raised fresh concerns about capital expenditure and the sustainability of technology sector investments.

The broader market shift also benefited traditional safe-haven assets, including US Treasury securities. Crude oil prices moved higher, while Bitcoin declined 1.2%, falling below $78,000 amid a separate cryptocurrency market disruption.

These market movements highlight wider concerns about the concentration of economic growth around artificial intelligence. An analysis published by Asia Times on October 28 warned that a slowdown in spending by major US technology companies could have substantial consequences for Asian economies heavily exposed to semiconductor production.

South Korea has become particularly dependent on semiconductor demand. According to the Asia Times report, chips account for 41% of the country's exports, which increased 83.5% year over year in September. During the first 20 days of October, semiconductor exports surged 263%, while computer exports climbed 435%.

Shipments to the United States increased 154% in October despite tariffs introduced under President Donald Trump. Exports to China also advanced 155%, demonstrating the strength of South Korea's technology trade.

SK Hynix reported quarterly profit seven times higher, reaching $63 billion, and announced plans to return approximately $45 billion to shareholders. South Korea's Kospi gained nearly 42% during the year, although Goldman Sachs reduced its 12-month index target by 25% because of concerns about AI investment and valuation volatility.

South Korean President Lee Jae Myung had pledged before taking office in June 2025 to lift the Kospi above 5,000 through corporate governance improvements and efforts to eliminate what he called the "Korea discount." The index subsequently reached that milestone amid the semiconductor-driven rally, without significant legislative reforms.

However, the International Monetary Fund has highlighted the risks associated with this concentration. Its Asia-Pacific director, Krishna Srinivasan, noted South Korea's substantial benefits from AI hardware demand, while colleague Sonali Jain-Chandra warned about the consequences of a potential reversal.

"A sharp reversal in AI investment," Sonali Jain-Chandra said in describing the potential disruption to South Korea's economy.

Her assessment identified the possible consequences for exports, investment, public finances and financial conditions.

"could lead to shrinking exports, reduced investment and declining government revenue, while also tightening financial conditions," she said, referring to the risks amplified by falling AI-related asset prices.

Taiwan faces a different but equally significant concentration risk because of its central role in global semiconductor manufacturing. Taiwan Semiconductor Manufacturing Co. (TSMC) directly contributes as much as 15% of the island's approximately $1 trillion annual GDP and supports roughly 1,600 domestic suppliers.

TSMC also represents at least 42% of the Taiwan Stock Exchange Weighted Index. The index had gained more than 61% during the year, leaving the market particularly exposed to changes in semiconductor demand and the company's performance.

Taiwan's economy expanded 12.92% year over year in the second quarter, following 15.43% growth during the first three months. September exports increased 60.9%, marking the second consecutive monthly record and the 35th straight month of annual growth.

Exports to the United States rose 106.2% in September to $27.46 billion, while shipments to China increased 30.2%. Nevertheless, manufacturing sectors such as machinery, basic metals, textiles and chemicals continue to face structural challenges.

Anthropic's potential public offering has added another dimension to questions about the sustainability of the AI business model. The company could raise as much as $100 billion, potentially making the listing the largest in history. Its growth projections include annual expansion of approximately 1,300%, net revenue retention of around 900% and implied gross margins of 85%, while critics have highlighted $80 billion in half-year net losses.

The company's regulatory filing also identifies operational and geopolitical vulnerabilities associated with its dependence on advanced chip manufacturing in Taiwan.

"Any restrictions or delays on the supply of advanced chips out of Taiwan or TSMC," Anthropic stated in its filing, "would adversely affect our business, financial condition and results of operations."

Denny Fish of Janus Henderson described the proposed listing as "a generational moment," while cautioning that "the devil comes down to the details, and we still don’t have all the details yet."

Analyst Jame DiBiasio, author of the J.DB Report newsletter, highlighted Anthropic's expanding ambitions beyond supplying artificial intelligence technology.

He described the company as "coming for finance," explaining that its strategy extends into professional financial applications.

"This is not simply a technology supplier offering banks a more intelligent chatbot," DiBiasio said.

"Anthropic is moving into the applications through which financial professionals work, while supplying the infrastructure on which competing applications depend," he added.

The filing also acknowledges broader technological and operational threats associated with artificial intelligence.

Anthropic warned of "catastrophic or existential risks to humanity" in its regulatory disclosures, alongside concerns involving supply-chain reliability, geopolitical tensions surrounding Taiwan and potential natural disasters affecting the island's electricity infrastructure.

Goldman Sachs, meanwhile, maintained that South Korean equities could retain investment appeal despite heightened volatility. The firm said the market was "pricing an overly negative fundamental outlook" and continued to see "attractive risk-reward."

Bank of Korea Governor Shin Hyun-song also identified the country's exposure to competing global developments, describing South Korea as positioned "at the intersection" of the AI investment boom and the war in the Middle East.

Meanwhile, the latest technology earnings losses have reinforced concerns that a reduction in spending by Microsoft, Amazon, Meta and Alphabet could quickly affect semiconductor manufacturers, equipment suppliers, data center operators and financial markets across Asia.