Asian stocks slid on Wednesday extending a brutal selloff as anxiety about AI valuations, rising competition and spending rocked markets ahead of crucial earnings from big tech firms and a US Federal Reserve policy decision.Oil prices jumped after fresh attacks in the Middle East shattered the relative calm of recent days in the US-Iran war as investors fret about the impact of depleting supplies on prices and global rates.
Asian chipmakers have been at the epicenter of this year's AI-driven rally and, more recently, investor concerns about its staying power, sparking sharp market swings.
South Korea's KOSPI fell 5 percent, reversing earlier gains after sinking more than 10 percent to a three-month low on Tuesday, despite strong earnings from SK Hynix.
Shares of SK Hynix fell 9 percent as investors digested earnings that showed the chipmaker increased quarterly operating profit more than sixfold but missed lofty expectations.
"With the FOMC meeting sandwiched between major US tech earnings this week, and expectations for AI capex already elevated, investors appear to be taking some risk off the table ahead of a critical test for both AI spending expectations and market liquidity," said Gary Tan, portfolio manager at Allspring Global Investments.
