Asian Markets Wobble as AI Fears Hit Software Stocks, Oil and Gold Rebound

Asian equity markets traded unevenly after sharp losses in U.S. and European stocks, driven by concerns that rapid advances in artificial intelligence could disrupt traditional software and professional services industries. The selloff intensified after Anthropic launched new plug-ins for its Claude Cowork AI agent, raising fears that AI could replace parts of data analytics and software services businesses.

While some Asian technology stocks declined, the region was relatively insulated compared to Western markets due to its stronger focus on hardware manufacturing rather than software. China’s CSI Software Services Index fell 3%, and Hong Kong’s Hang Seng Tech Index dropped 1.8%. In Japan, advertising firm Dentsu plunged over 6%, while Nomura Research Institute fell nearly 8%, contributing to a 0.8% decline in the Nikkei index. However, MSCI’s Asia-Pacific index outside Japan edged slightly higher, supported by gains in South Korea’s tech-heavy KOSPI.

Market participants noted that the AI-driven rally is becoming more selective, creating clear winners and losers within the technology sector rather than lifting all tech stocks uniformly.

Oil prices rose as geopolitical tensions in the Middle East escalated. Brent crude and U.S. crude both gained nearly 1% after the U.S. military shot down an Iranian drone near an aircraft carrier, and Iranian gunboats approached a U.S.-flagged tanker in the Strait of Hormuz, a vital oil transit route for major OPEC exporters.

Precious metals rebounded from recent heavy losses, with gold climbing nearly 3% and silver rising more than 3%. The earlier selloff followed the nomination of Kevin Warsh as the next Federal Reserve chair, as his preference for a smaller Fed balance sheet typically pressures non-yielding assets like gold.

Currency markets were relatively calm, with the dollar pausing its rally, the yen weakening ahead of Japan’s elections, and cryptocurrencies remaining under pressure. Investors expect market volatility to persist in the near term until clearer signals emerge on monetary policy and global growth.