Nvidia Sell-Off Impacts Asian Markets

Asian Markets Slip From Record Highs as Wall Street Weakness and AI Volatility Weigh on Sentiment​

Asian equities retreated from record levels on Friday morning after a pullback in US benchmarks dampened global risk appetite, even as the region continues to outperform on the back of artificial intelligence driven optimism.

Nikkei, Kospi Open Lower; MSCI Asia Pacific Stays Flat​

Japan’s Nikkei 225 and South Korea’s Kospi declined at the open, leaving the MSCI Asia Pacific Index largely flat in early trade. The regional gauge had climbed more than 6% in February and was heading for its third straight month of gains.

The muted start follows weakness on Wall Street, where futures for US benchmarks slipped in early Asian hours after the S&P 500 dropped 0.5% and the Nasdaq-100 fell 1.2% on Wednesday.

A sharp 5.5% decline in Nvidia marked its worst session since April last year, weighing on the broader “Magnificent Seven” cohort of mega cap technology stocks.

AI Headlines Continue to Drive Market Swings​

The market reaction underscored the sensitivity of global equities to artificial intelligence related developments. Investors, corporates, governments and central banks are still assessing the long term economic implications of rapid advances in AI.

While US markets showed vulnerability to AI linked volatility, Asian stocks have outperformed in recent months. Investors have increasingly favored regional firms seen as the “picks and shovels” suppliers in the AI supply chain, benefiting from the global build out of infrastructure.

Despite Nvidia reporting better than expected revenue, net income and guidance, the relatively restrained market response reflected elevated expectations, according to commentary cited from Fundstrat Global Advisors.

Bonds Steady, Yields Ease; Oil Holds Losses​

In fixed income markets, US Treasuries held onto gains, with the 10 year yield hovering near 4%. During the US session, it touched its lowest level of the year. Australia’s 10 year yield fell five basis points to 4.65% in early Friday trade, while the dollar remained volatile.

In commodities, West Texas Intermediate crude traded around 65.25 dollars per barrel, largely holding earlier losses. The US and Iran are set to continue nuclear talks next week after mediator Oman reported significant progress in discussions held in Switzerland.

After Hours Moves: Block and Dell Jump on AI Developments​

AI related momentum persisted beyond the New York close. Shares of Block, Inc., the payments firm co founded by Jack Dorsey, surged more than 20% in after market trading after the company announced plans to cut nearly half its workforce, around 4,000 jobs, as part of a pivot toward AI.

Meanwhile, Dell Technologies Inc. rose in extended trading after issuing a stronger than expected outlook for sales of artificial intelligence servers.

Asia Outperforms Despite Volatility​

Amid the turbulence, Asian and other emerging markets have emerged as relative bright spots. The MSCI Asia Pacific Index has advanced in February, lifting year to date gains to 15%. By comparison, the S&P 500 is up 0.9% this year, while the Nasdaq 100 has declined by 0.9%.

In Japan, Tokyo’s core inflation slowed to its weakest pace in more than a year as utility subsidies introduced by Prime Minister Sanae Takaichi reduced household energy costs. The yen edged slightly stronger on Friday.

As global markets continue to digest AI driven developments and shifting macro signals, Asia’s performance remains closely tied to both technology supply chains and evolving investor expectations.