Business · Markets · 35 mins ago
Asian shares fall as concerns about AI spending weigh on markets
Asian shares fell on Monday as worries about AI spending weighed on confidence.
The declines came as investors questioned whether future AI revenues will justify the large sums companies are investing in infrastructure.
Japan's Nikkei fell 2%, while South Korea's market dropped 1.6%; both had also fallen sharply the previous week.
Higher government bond yields and wider corporate credit spreads are raising borrowing costs, adding pressure to companies financing AI projects.
Investors are looking to this week's earnings for signs that tech spending can pay off, with Meta, Lam Research and Texas Instruments among the companies due to report.
Five major AI companies are expected to spend about $1.2 trillion combined next year, according to Goldman Sachs.
Oil prices fell after US President Donald Trump said he would waive some sanctions on Russia, but he later said no final decision had been made.
Asian shares fell on Monday as investors worried about the business outlook for artificial intelligence and the sustainability of spending on AI infrastructure.
Japan’s Nikkei fell 2.0% and South Korea’s market dropped 1.6%, while MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.3%.
The declines followed losses in US technology shares the previous week, including a 4.5% fall in the Nasdaq.
Investors are watching earnings reports from major US companies this week, including Meta and Tesla, for clues about technology-sector prospects.
- Who
- Investors and Asian stock markets.
- What
- Asian shares fell as concerns about AI business prospects and infrastructure spending weighed on sentiment.
- When
- Monday, October 19, 2026.
- Where
- Asian markets, including Japan and South Korea.
- Why
- Investors questioned whether AI revenues can justify the large investments in infrastructure and how those investments will be financed.
This story does not have two clearly opposing sides.
The Nasdaq fell 4.5%, while the PHLX Semiconductor Index lost 11.4%.
Asian shares fell as concerns about AI spending weighed on markets.
Meta is scheduled to report earnings, alongside semiconductor firms Lam Research and Texas Instruments.
- Nikkei
- Fell 2.0% on Monday, according to Economic Times.
- South Korea
- Market dropped 1.6% on Monday, according to Economic Times.
- MSCI Asia-Pacific ex-Japan index
- Fell 0.3%.
- Nasdaq
- Dropped 4.5% during the previous week, according to CNBC Indonesia.
- Meta earnings
- Expected on Wednesday.
2 sources
What people are saying
Investors have long worried that AI revenues won't be sufficient to recoup the massive upfront investment, while AI infrastructure may need to be written down as it ages and depreciates in the meantime, which lowers book value massively
The last time spreads were almost this wide, related stocks were 15% lower.