This update was written automatically with AI from market data and news wire reports, and published without review by a person.
Key Takeaways
- South Korea’s Kospi index plunged 7%, led by a massive selloff in semiconductor heavyweights Samsung Electronics (SSNLF) and SK Hynix (HXSCL) amid AI valuation concerns.
- Bitcoin (BTC) tumbled to $81,500 as hotter-than-expected US inflation data (3.7% in September) fueled expectations for more aggressive Federal Reserve rate hikes.
- Australia’s unemployment rate rose to 4.7%, its highest level in nearly five years, following a surprise loss of 39,300 jobs in September.
- US Senate Democrats are investigating Meta (META) over its reported use of $6.6 billion in R&D tax credits for AI data centers, questioning if infrastructure was mislabeled as "pilot models."
- Gold prices jumped 1% to $4,144.03 per ounce, recovering from a two-month low as investors sought safe-haven assets despite a strengthening US dollar.
Asian Markets Reel from Chip Rout and Inflation Shock
The South Korean stock market entered a free fall on Thursday, with the Kospi index plunging 7% to its lowest level since late July. The rout was triggered by a combination of a "risk-off" mood following US inflation data and deepening anxiety over the artificial intelligence trade. Industry bellwethers Samsung Electronics (SSNLF) and SK Hynix (HXSCL) saw their shares tumble as much as 10% and 7% respectively, as investors reacted to reports of increasing competition from Chinese memory-chip manufacturers.
In Japan, the 10-year JGB yield declined 5.5 basis points to 2.94%, reaching its lowest level since September 10. This move came as traders weighed the impact of potential fiscal policy shifts and the broader global selloff in equities. The divergence between falling yields in Japan and rising rate expectations in the US has kept the yen under significant pressure.
US Inflation Data Rattles Crypto and Commodities
Digital assets faced significant downward pressure after the US Bureau of Labor Statistics reported that annual inflation accelerated to 3.7% in September. Bitcoin (BTC) fell as much as 2.3% to approximately $81,500, triggering over $815 million in liquidations across the broader crypto market. The hotter-than-expected CPI reading has cooled hopes for near-term Federal Reserve rate cuts, with markets now pricing in a higher probability of a hike at the October 28 meeting.
In the commodities sector, US natural gas futures fell 2.6% to $3.198/MMBtu, marking their largest drop in two weeks. The decline followed a recovery in production after Hurricane Isaias, with output reaching 111.4 Bcf/d. Conversely, spot gold rose 1% to $4,144.03, as the metal found a floor near $4,000 despite the headwinds of a stronger US dollar and elevated Treasury yields.
Regulatory Scrutiny and Labor Market Shifts
Meta (META) is facing a formal inquiry from US Senate Democrats, led by Senator Ron Wyden, regarding its tax practices. Lawmakers are investigating whether the company improperly used $6.6 billion in R&D tax credits to fund its massive AI data center buildout by classifying them as experimental "pilot models." Meta has until October 31 to respond to the inquiry, which could set a major precedent for how the AI industry handles infrastructure-related tax breaks.
In Australia, the labor market showed unexpected signs of cooling as the unemployment rate climbed to 4.7%. While full-time employment grew by 42,400, it was not enough to offset a massive 73,700 drop in part-time roles. This shift has led some economists to suggest that the Reserve Bank of Australia may pause its tightening cycle as the economy begins to shed jobs under the weight of high interest rates.
Automated market updates written with AI from market data and news wire reports, published without human review.