Asian Shares Follow Wall Street Lower As AI Jitters Spread

(RTTNews) - Asian stocks followed Wall Street lower on Friday as investors fretted over the impact of artificial intelligence on various sectors and looked to U.S. CPI data later in the day for clues on when the Federal Reserve might cut rates.

Forecasters expect inflation to have decelerated in January, with core prices rising 2.5 percent year-over-year, the lowest since 2021.

This week's stronger-than-expected U.S. labor data sharply reduced hopes of near-term Federal Reserve rate cuts.

In trade developments, the United States and Taiwan have finalized a trade deal to reduce tariffs, boost market access for American products in Asia and direct billions of dollars into U.S. energy and technology projects.

The dollar index was steady in Asian trade, helping gold prices bounce back after tumbling 3 percent to almost a one-week low in the previous session.

Oil prices were on track for a second weekly decline on receding concerns of a U.S.-Iran conflict and supply glut fears.

China's Shanghai Composite index ended down 1.26 percent at 4,082.07 ahead of a week-long holiday. Hong Kong's Hang Seng index slumped 1.72 percent to 26,567.12, dragged down by technology stocks.

Japanese markets ended lower as SoftBank Group shares plummeted on AI-related concerns. Shares of the technology group plunged 8.9 percent despite the company reporting a nearly five-fold jump in its net profit in the nine months through December.

The Nikkei average fell 1.21 percent to 56,941.97 while the broader Topix index closed 1.63 percent lower at 3,818.85.

Seoul stocks fluctuated before ending modestly lower. The Kospi average dropped 0.28 percent to 5,507.01, snapping a four-day winning streak ahead of next week's extended market holiday for the Lunar New Year.

Australian markets joined a global sell-off on concerns over AI disruptions. The benchmark S&P/ASX 200 fell 1.39 percent to 8,917.60 while the broader All Ordinaries index settled 1.54 percent lower at 9,138.80.

Tech shares came under heavy selling pressure, with WiseTech Global plummeting 10.4 percent and Xero losing 4.5 percent on fears that artificial intelligence will disrupt established business models.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index slumped 2.46 percent to close at 13,198.18, hitting an over four-month low as strong manufacturing PMI data tempered investor expectations of aggressive near-term RBNZ easing.

Overnight, U.S. stocks tumbled as investors fretted about the impact AI could have on revenues and profit margins of financial, transportation and logistics and even commercial real estate companies.

Networking giant Cisco Systems gave a weaker-than-expected forecast for profitability, signaling higher memory-chip prices are taking a toll.

In economic news, Treasury yields reached two-month lows after the number of Americans filing first-time unemployment claims decreased less than expected last week and existing home sales tumbled to the lowest level in more than two years in January.

The tech-heavy Nasdaq Composite lost 2 percent, the S&P 500 slumped 1.6 percent and the Dow declined 1.3 percent.