Global equity markets stabilized on Thursday after a severe technology-led selloff in Asia, but investors remained cautious about high interest rates and the sustainability of artificial-intelligence spending. South Korea’s Kospi suffered one of the day’s sharpest declines and Japan’s Nikkei also fell heavily, while European and U.S. markets recovered some ground. Bond yields moved lower and gold rose as investors shifted part of their portfolios toward defensive assets.
Asian technology shares took the biggest hit
Chipmakers and AI-linked companies faced intense selling as investors questioned whether current valuations can be justified by future earnings.
South Korea was especially vulnerable because semiconductor companies represent a large share of its equity market.
Japan also fell sharply
The Nikkei declined as technology and semiconductor-related stocks came under pressure.
Higher global rates also hurt companies that depend on long-duration growth expectations.
Europe recovered from early weakness
European shares initially followed Asia lower but later stabilized.
Banking and defensive sectors helped offset some of the pressure on technology companies.
U.S. indexes were relatively resilient
The Dow, S&P 500 and Nasdaq avoided the scale of losses seen in Asia.
Healthcare, materials and other sectors helped broaden market support.
Bond yields fell despite hot inflation
Strong U.S. producer-price data would normally push yields higher, but safe-haven demand supported government bonds.
The move suggests investors were more concerned about market stress than near-term inflation alone.
AI spending is under new scrutiny
Data centers, advanced chips and power infrastructure require enormous capital investment.
Investors are now asking whether revenue growth will arrive fast enough to justify the debt and equity financing behind those projects.
The dollar weakened
A softer dollar helped gold and other commodities rebound.
Currency moves also reflected changing expectations for Federal Reserve policy and global risk appetite.
Oil remained elevated
Brent crude stayed above $100 a barrel as geopolitical risks continued to affect energy supply expectations.
High oil prices remain a source of inflation pressure for both companies and consumers.
Gold benefited from the risk shift
Spot gold climbed more than 1% as investors looked for alternatives to volatile equities.
Falling Treasury yields added support to the move.
The market is becoming more selective
The broad AI investment narrative is no longer lifting every company equally.
Investors increasingly distinguish between businesses with strong cash flow and those dependent on continuous external financing.
Sources
- Reuters global markets coverage, Oct. 15, 2026
- Major exchange and bond market data
