Asian Stocks Decline as Investors Exit Tech Shares Ahead of U.S. Jobs Data

Asian stock markets mostly moved lower on Friday as investors took profits from technology stocks and shifted funds into sectors that are more closely tied to economic growth. The sell-off was particularly severe in Japan and South Korea, where chipmakers and artificial intelligence (AI)-related companies extended recent losses.

South Korea’s KOSPI index was the region’s worst performer, falling sharply as major semiconductor companies came under pressure. Samsung Electronics and SK Hynix both recorded significant declines, reflecting investor concerns about the technology sector after its strong rally in recent months. Market sentiment was also affected by comments from Labor Minister Kim Young-Hoon, who suggested that major technology companies should distribute a larger share of AI-generated profits to workers, suppliers, and subcontractors.

Japanese stocks also struggled, with the Nikkei 225 dropping as investors sold chip and AI-related shares. Companies such as SUMCO, Ibiden, and Renesas Electronics were among the biggest losers. Despite weakness in technology stocks, the broader TOPIX index remained relatively stable thanks to gains in industrial and consumer-focused sectors.

Investor caution increased amid growing expectations that the Bank of Japan (BOJ) could raise interest rates later this month. Stronger-than-expected wage growth data for April reinforced speculation that the central bank may have additional room to tighten monetary policy. BOJ Governor Kazuo Ueda recently indicated that policymakers will discuss potential rate increases during upcoming meetings.

Across the region, market performance remained mixed. Hong Kong’s Hang Seng Index declined as technology shares weakened, while mainland Chinese benchmarks, including the Shanghai Composite and CSI 300, traded within a narrow range. Australia’s ASX 200 also ended lower, while Singapore’s Straits Times Index posted modest losses.

Meanwhile, U.S. stock futures pointed to further weakness in technology shares, with Nasdaq 100 futures falling and S&P 500 futures also moving lower. Investors are closely monitoring the upcoming U.S. nonfarm payrolls report for fresh insights into the strength of the American economy.

Geopolitical uncertainty surrounding tensions in the Middle East and the ongoing U.S.-Iran conflict also weighed on market sentiment. In India, investors remained focused on the Reserve Bank of India’s interest rate decision, with expectations that policymakers will keep rates unchanged while maintaining a cautious outlook amid global economic risks.