According to Reuters, Asian stock markets traded cautiously on Wednesday, following sharp losses in U.S. and European equities amid growing concerns that rapid advances in artificial intelligence could disrupt traditional software and services industries.
Investors remained wary after heavy selling in data analytics, professional services, and software firms in Western markets. The decline intensified after Anthropic launched new plug-ins for its Claude Cowork agent last week, raising fears of widespread AI-driven disruption. However, selling pressure in Asia was relatively limited, as the region remains heavily focused on hardware manufacturing.
MSCI’s broad Asia-Pacific index excluding Japan slipped 0.2%, while Japan’s Nikkei index fell 1.23%. South Korea’s KOSPI declined 0.14%, and Taiwan’s main index dropped 0.68%.
Nasdaq futures fell 0.25%, while S&P 500 futures were down 0.1%. EURO STOXX 50 futures also edged lower. Ben Bennett, head of investment strategy for Asia at L&G Asset Management, said market reaction to AI developments was becoming more selective.
“The AI trade is splitting between relative winners and losers. Not all technology companies will benefit equally,” he said.
Oil prices moved higher after reports that the U.S. military had shot down an Iranian drone near an aircraft carrier and Iranian gunboats approached a U.S.-flagged tanker. Brent crude rose 1% to $68.03 per barrel, while U.S. crude climbed 1.1% to $63.90.
The incidents raised concerns that diplomatic efforts to ease U.S.-Iran tensions could be disrupted. Much of the region’s oil exports pass through the Strait of Hormuz, making the area critical for global energy supplies.
Precious metals rebounded after heavy losses earlier in the week. Spot gold rose 1.5% to $5,014.31 per ounce, while silver gained 1.7% to $86.57. The recent decline followed the nomination of Donald Trump’s pick for Federal Reserve chair, Kevin Warsh, and a rise in margin requirements by CME Group, which intensified selling pressure.
Warsh is widely seen as favoring a smaller central bank balance sheet, a policy that usually weighs on non-yielding assets such as gold.
Joshua Chim, general manager of online broker FSMone, said volatility was likely to continue in the short term, though retail investors were buying gold and silver through funds and exchange-traded products.
Currency markets were relatively calm, with the U.S. dollar pausing after a recent rally linked to the Warsh nomination. The Japanese yen weakened beyond 156 per dollar ahead of weekend elections, while the euro traded at $1.1821 and sterling at $1.3710.
Bitcoin remained near its lowest level since November 2024, rising only 0.6% to $76,658.96 after falling nearly 3% a day earlier. Manuel Villegas Franceschi of Julius Baer said the cryptocurrency market had weakened significantly since October, with Warsh’s nomination acting as a major turning point.
U.S. Treasury yields were little changed, with the 10-year yield at 4.28% and the two-year yield at 3.58%. Long-term yields have edged higher as investors assess how a Federal Reserve under Warsh may manage its balance sheet. Christian Nolting, global chief investment officer at Deutsche Bank Private Bank, said future policy decisions were likely to remain data-driven rather than automatic.