Japan stock market falls more than 6% after US AI shares fall

A screen displays the Korean Composite Stock Price Index (KOSPI) in a Hana Bank trading room in Seoul, South Korea, on Thursday, Nov. 5, 2026. — Photo: Lee Jin-man/AP

The Nikkei 225, Tokyo's main index, fell 6.2% in morning trading to 57,271.19 points. Australia's S&P/ASX 200 lost 0.7% to 9,003.40 points. South Korea's Kospi fell 7.1% to 5,000.25 points.

Stock markets around the world have come under pressure from the continued declines of companies that have benefited from the boom in artificial intelligence technology. These stocks have been wavering for months on concerns that construction of AI data centers could slow as loans become more expensive. Critics also claim that the share prices of AI companies rose too much and were in a bubble.

On Wall Street, the S&P 500 fell 4.4% on Thursday, in its worst day since US President Donald Trump roiled world markets in April 2025 with his “Liberation Day” tariffs. The drop more than erased the advance recorded by the American stock market the previous day, which had been the best in three months.

The Dow Jones Industrial Average fell 1,833 points, or 3.4%, while the Nasdaq Composite fell 5.5%. The Nasdaq, which concentrates stocks linked to AI and other technology companies, was 11.9% below its historic high, reached last month. In the financial market, a loss of more than 10% is called a “correction”.

The midterm elections held in the United States on Tuesday added yet another challenge. Democrats' victories across the country have raised the possibility that governments could impose pauses on construction of new data centers. Voters from different parties say they are wary of AI and disapprove of increases in energy bills caused by data centers.

Any slowdown in the construction of AI data centers would mean fewer purchases of artificial intelligence chips, as well as a reduction in the consumption of electricity and other products and services absorbed by the AI ​​rush, which has been driving much of the growth of the American economy.

Nvidia, the chipmaker that quickly became a symbol of the AI ​​boom, fell 9.3% and was by far the biggest drag on the S&P 500. Year-to-date, the company is now down 2.6%, after annual gains of about 39%, 171% and 239% over the past three years.

Advanced Micro Devices fell 17.3%. CoreWeave, a company that rents customers access to AI chips through the cloud, fell 9.8%. GE Vernova, which has been helping power data centers, fell 7.5%.

Compounding investors' losses, AI chipmaker stocks are among Wall Street's most influential because they have become some of the market's biggest. A 1% move in Nvidia shares, for example, has more impact on the S&P 500 than a 1% move in almost any other American stock.

In the long term, stock prices tend to follow the trajectory of corporate profits and interest rates, depending much more on these factors than on who controls power in Washington.

In the energy market, US benchmark crude oil rose 0.60% to $91.06 per barrel. Brent, an international reference, advanced 3.88%, to US$ 98.29 per barrel. Uncertainty still prevails over what will happen in the war with Iran and when the global energy industry will be able to return to normal.

In the bond market, Treasury yields continued to fall on Thursday. The yield on the 10-year U.S. Treasury note fell to 4.84% from 4.90% late Wednesday. It was at 4.95% on election night and up from 5.30% last month. This could be a sign that investors are flocking to US Treasuries in search of assets considered safer in the face of falling stocks.