Asian stocks plunge as AI sell-off triggers a trading halt in South Korea

South Korea’s stock-market slide triggered a 20-minute trading halt on November 6, 2026, as an AI-driven sell-off spread from Wall Street to Asia. The KOSPI plunged more than 8%, while Japan’s Nikkei fell 5%. Reuters linked the retreat to fears of tighter AI oversight and a slowdown in infrastructure investment.

The Asian losses followed a bruising U.S. session. The Nasdaq dropped 5.5%, and the Philadelphia Semiconductor Index sank 12.2%. Some $3 trillion in market value was wiped from S&P 500 companies. Reuters described the U.S. decline as the steepest since the tariff-triggered “Liberation Day” rout a year and a half earlier.

Thursday’s selling also deepened a retreat that had been building for weeks. The Nasdaq stood 12% below its record closing high a month earlier. It had initially moved higher after the U.S. midterm elections before reversing, while Wall Street’s closely watched volatility gauge surged during the sell-off.

Election fears hit an already fragile AI trade

The political concern centered on Democratic victories in this week’s U.S. midterm elections. Investors worried that the party would apply greater scrutiny to AI and put limits on the industry’s expansion, Reuters reported. That was a fear about the direction of policy, rather than a newly announced restriction driving the market moves.

Those expectations landed on an AI investment trade already weakened by doubts about its financial payoff. Reuters described investors questioning the returns on the enormous sums flowing into the technology. The immediate political jitters therefore compounded an existing concern about whether the scale of investment would be justified.

Market participants saw chipmakers and data-center equipment suppliers in South Korea, Taiwan and Japan as particularly exposed. Those businesses had already suffered stock declines on Wednesday and Thursday. Friday’s regional retreat extended that pressure, with the Korean benchmark falling far enough to activate exchange circuit breakers and interrupt trading.

“Market turning points are often accompanied by strong disagreement, and that shows up in the market by huge swings in either direction,” he said. “That's what we appear to have had — and last night's emphatic sell-down suggests that is the direction that we're now headed in.”

Michael McCarthy, Moomoo’s chief executive for Australia and New Zealand, speaking to Reuters

Data-center opposition enters investors’ calculations

The concerns extended beyond potential federal oversight. Reuters reported that investors were beginning to factor in local opposition to data-center construction. Analysts said markets had not fully accounted for the costs that building those facilities had imposed on communities, adding another source of uncertainty around the infrastructure expansion.

Other markets showed investors moving toward assets viewed as safer. Bonds were poised to gain in Asia, while the U.S. dollar slipped against the Japanese yen and Swiss franc. Those moves accompanied the equity losses, although the anticipated Asian bond gains were an outlook rather than a completed session’s result.

Nick Ferres, chief investment officer at Singapore’s Vantage Point Asset Management, told Reuters that U.S. Treasury bonds could rally further. He also expected an ugly day for semiconductor and memory stocks—a warning that the hardware businesses behind the AI buildout could face more selling as the Asian session continued.