The MSCI Asia Pacific Index dropped 0.3% at the open. The Kospi Index in South Korea — a poster child for artificial intelligence investments and the best-performing index worldwide this year — led the losses, dropping 1.6%.

The Asian moves came after the Nasdaq 100 saw its worst two-day rout since October, breaching its 100-day moving average, a level seen by some technical analysts as a harbinger for more losses. Futures contracts for US gauges, however, rose 0.3% in early Asian trading, indicating selling pressure may be easing.

Elsewhere, gold and silver advanced, continuing their rebound from a historic plunge, while Bitcoin trimmed some of its losses. The yen was a touch weaker at 156.93 to a dollar on Thursday, extending its losses with elections in Japan set for the weekend. The Bloomberg Dollar Spot Index held its gains from the prior session.

The tech-heavy selloff reflected further concerns among investors regarding tech valuations, high levels of spending and the potential for AI to cannibalize established software business models. In tech-related earnings, Alphabet Inc. shares fell in extended trading after outlining an ambitious capital spending plan, while Arm Holdings Plc slipped post-market on a disappointing sales forecast, and Qualcomm Inc. gave a lackluster revenue outlook.

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“There might be a glass half full and a glass half empty perspective on the moves here,” said Kyle Rodda at Capital.com. “On the one hand, tech stocks are potentially too richly valued. On the other hand, the strength in the market is broadening out in a sign of improving economic fundamentals.”

Bloomberg

In other corners of the market, Bitcoin hovered near $73,000, with prediction traders betting the world’s most popular cryptocurrency will drop below $65,000. Treasuries were mixed on Wednesday, with the short-end of the curve rallying. The US two-year yield fell two basis points while the 10-year ended one basis point higher.
The pound and euro were steady ahead of interest rate decisions due later Thursday. The European Central Bank and Bank of England are expected to leave rates unchanged.
Meanwhile, clear signs of momentum behind the tech sell-off emerged. The iShares MSCI USA Momentum Factor ETF plunged 3.7%, while a Goldman Sachs Group Inc. basket that goes long high-beta momentum names and short the opposite tumbled 9.8%.

Rotation out of tech was the main theme during the US session and software firms saw another wave of selling, but moves were bigger in chipmakers. A Bloomberg gauge of the so-called Magnificent Seven companies fell 1.8%.

What Bloomberg strategists say…
What looks like a brutal equity rotation away from concentration is actually proving to be a bright spot for the broader market. US equities are experiencing a rotation that in the moment seems painful, but was ultimately inevitable.

— Brendan Fagan, Macro Strategist.

Traders are also paying attention to the moves in the precious metals. Gold and silver rose for a third consecutive day after retreating from a record on Friday.

Precious metals soared last month in a rally underpinned by speculative momentum, geopolitical upheaval and concerns about the Federal Reserve’s independence. The surge came to a sudden halt at the end of last week, with silver seeing its biggest ever daily drop on Friday and gold plunging the most since 2013.

Gold traded just above $5,000 an ounce and silver was about $89.

In the US, service providers saw the strongest back-to-back growth since 2024 as business activity picked up even as employment barely expanded. While companies added fewer jobs than expected, recent data has pointed to limited layoffs.

Elsewhere, US President Donald Trump and President Xi Jinping of China discussed trade and geopolitical flashpoints, including Taiwan, during a Wednesday call ahead of a planned face-to-face meeting later this year.

In commodities, oil fell for the first time in three days after Iran confirmed it would hold negotiations with the US, easing the immediate risk of military strikes against the OPEC producer.