AI fears hit Asia: Nasdaq down almost 7% in October
In short
- Asian markets opened weaker: Nikkei −0.5%, South Korea −0.8% (−16% in October); S&P 500 futures are +0.4% and Nasdaq futures +0.6%.
- The Nasdaq lost almost 7% in October, its worst month since April 2025, as the cost of insuring against corporate defaults jumped on AI spending worries.
- Futures price a 72% chance of a Fed rate hike in December; the 10-year Treasury yield is 4.952%.
Asian shares started the week lower on fears that the AI investment boom is getting too expensive. At 7:00 a.m. Sofia time (12:00 a.m. Eastern) gold is at $3,916 an ounce and Bitcoin at $78,620.
What happened
According to MarketScreener, Japan’s Nikkei is down 0.5%, South Korea 0.8% and MSCI’s Asia-Pacific index excluding Japan 0.4%. South Korea fell 16% in October. Eurostoxx 50 futures are up 0.1%, while DAX futures are flat.
The trigger: the cost of insuring against corporate defaults jumped last week on worries about negative cash flow and the scale of AI spending. Goldman Sachs expects capex at the big cloud companies to nearly double to $800 billion this year and reach $1.2 trillion in 2027. Earnings are still growing strongly (about 30% for the S&P 500 in 2026), but Goldman says growth is “no longer accelerating”.
On Friday the S&P 500 closed at 7,580 (−1.8%) and the Nasdaq 100 at 28,385 (−3.5%); Intel fell almost 29%. Apple, AMD and Palantir report this week. Markets price a 72% chance of a Fed hike in December, with the 10-year Treasury yield at 4.952%. Brent is at $111.72 (−1.5%).
What it means for you
The math: if you put $1,000 into a Nasdaq index fund at the start of October, a drop of almost 7% leaves roughly $930 (before fees). It would then need a gain of about 7.5% to get back to $1,000.
See also: live stock market prices and how Wall Street fell on Friday.
Bottom line
Asia is following Wall Street lower, and the trigger is the price of AI investment rather than new bad economic news. The Nasdaq is down almost 7% for October, and markets give a 72% chance of a December rate hike.
Sources: MarketScreener
For information only. This is not investment advice.
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