On October 15, stock markets across Asia suffered a broad and sharp selloff. South Korea's market plunged more than 7%, Japan fell nearly 5%, and Nasdaq futures dropped over 1%.
In China's A-share market, the three major indices all declined after a day of choppy trading. The Shanghai Composite fell 1.59%, the Shenzhen Component dropped 2.43%, and the ChiNext Index slid 2.92%. Only 430 stocks advanced, with 36 hitting the daily limit-up, while 5,108 stocks declined.
Liquor stocks bucked the downward trend, with Huangtai Distillery posting its second limit-up in three days. Brokerage shares also saw intraday movements, as Hualin Securities hit the daily limit-up and Jinlong Group touched the limit-up level. PCB concept stocks remained active, with Aohong Electronics hitting the limit-up and reaching a new high, while Jinlu Electronics, Tianjin Printronics Circuit, and Chongda Technology also closed at the limit-up.
On the losing side, the shipping sector retreated, with Cosco Shipping Energy Transportation and China Merchants Energy Shipping hitting the limit-down. The coal sector weakened, as Yunnan Coal Energy hit the limit-down. Computing hardware and semiconductor chip stocks led the declines.
Broad-based ETFs saw significantly increased volume near the close. The ChiNext ETF from E Fund (159915) and the STAR 50 ETF from ChinaAMC (588000) both recorded trading volumes exceeding 10 billion yuan, while the CSI 300 ETF from E Fund (510310) surpassed 15 billion yuan, marking a nearly nine-month high.
What triggered the selloff
After last night's inflation data was released, traders increased their bets on further Federal Reserve rate hikes. Even if the Fed holds steady in October temporarily, it may continue raising rates afterward. Following the release of the U.S. Consumer Price Index (CPI), Treasury bonds initially fell but later recovered losses as investors found the yields near multi-year highs attractive.
After a fierce rally, global stock markets are under mounting pressure. Investors are beginning to question whether the hundreds of billions of dollars poured into AI will generate returns that match the investment. This has driven capital toward safer assets.
Meanwhile, the Middle East conflict has pushed oil prices higher, keeping U.S. inflation stubborn and raising the likelihood that central banks will adopt more aggressive tightening measures, adding further pressure on markets.
Hiroshi Namioka, chief strategist at T&D Asset Management, said: "Investors are currently reducing risk exposure and moving funds into safe-haven assets as much as possible. We are witnessing a fairly violent, very typical risk-off trade."
Analysts noted: "Thursday's sharp selloff in Asian stocks is reminiscent of the last week of July. At that time, South Korea's KOSPI led the decline, plunging nearly 11% in a single day. During that period, safe-haven flows briefly entered the bond market, but it did not last long, as rising energy prices quickly pushed bond yields higher again. This time, however, the situation may be different. The risk of an AI bubble bursting could harm economic growth."
After CoreWeave shares plunged as much as 17% last night, traders remain highly focused on the tech sector. The company's bonds maturing in 2032, which investors bought at face value just four months ago, are now trading below 78 cents on the dollar.
Jung In Yun, CEO of Fibonacci Asset Management Global, said: "The unexpected rise in U.S. CPI data, combined with the selloff in CoreWeave bonds, is prompting investors to reassess the financing risks across the entire AI industry."
Anthropic revenue and market concerns
In other news, according to people familiar with the matter, AI model developer Anthropic told potential investors that its third-quarter revenue reached $16.8 billion. The company is continuing to push forward with its listing plans. Some analysts believe this revenue figure came in below market expectations.
Hebe Chen, senior market analyst at Vantage Global Prime, said: "The market is not disappointed by Anthropic's impressive revenue figures, but is increasingly concerned about the side effects of sustaining such growth. The timing of this report further amplified investor worries. With market liquidity already tightening, investors are beginning to question: how much more capital will AI consume, and how much will Anthropic's upcoming IPO drain from the market?"
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