Global Markets Mostly Down as Tech Stocks Slip on Valuation Jitters
By Dow Jones Newswires StaffInternational stock markets took their cue from the tech-driven fall on Wall Street in the prior session, with most markets declining. Jitters about soaring valuations tied to artificial intelligence have combined with uncertainty over the Federal Reserve's rate path to knock the wind out of the stock market's record run. Strong corporate earnings in other sectors may also be spurring investors to rotate into non-tech stocks as company reports continue to roll in. Qualcomm, Arm Holdings, Robinhood and McDonald's all report later.Meanwhile, the U.S. Supreme Court is due to hear opening arguments in the case against President Trump's use of the International Emergency Economic Powers Act to impose broad tariffs.U.S. stock futures were trading either side of flat early in European business hours after the S&P 500, Nasdaq and Dow Jones Industrial Average all fell Tuesday. In recent trading, S&P futures were flat, Nasdaq futures were down 0.2% while those for the Dow Jones Industrial Average rose 0.1%.Asian markets slumped, tracking the overnight losses on Wall Street, with tech stocks leading the way down. South Korea's benchmark Kospi fell 2.9% to close at 4004.42, marking its sharpest daily decline in three months. Index heavyweight Samsung Electronics dropped 4.1%. Japan's Nikkei fell 2.5% in closing. Still, Hong Kong's Hang Seng ended down just 0.1% and mainland China stocks rose after Beijing said it will suspend some tariffs on U.S. imports.European tech stocks also followed U.S. and Asian peers lower on continued fears over high valuations and AI spending. "Until you get to a point where investors can confirm that the magnitude of the expenditures is justified by future revenues, we will probably see a lot of volatility in these stocks," chief of investment strategy and research at Glenmede Jason Pride wrote. Shares of BE Semiconductor were down 2.6% and ASM International fell 2.4%.The dollar remained close to a three-month high following a scaling back of U.S. interest-rate cut expectations. Wednesday's focus turns to the ADP private payrolls report which could take on added importance given official jobs data are halted during the government shutdown. The DXY dollar index against a basket of major currencies was recently flat at 100.163, near the high of 100.255 reached Tuesday.Bitcoin recovered marginally after falling below the key $100,000 level for the first time since June overnight. "The last 24 hours have brought a clear risk-off move, as concerns over lofty tech valuations have hit investor sentiment," Deutsche Bank analysts said in a note. Bitcoin was recently up 1.6% to $101,941 after reaching a four-and-a-half-month low of 98,992 overnight, according to LSEG data.U.S. Treasury yields declined ahead of the ADP employment report and ISM services PMI, both for October. Another potential driver could be the Treasury's quarterly refunding schedule, which follows Monday's announcement of lowered borrowing needs in the fourth quarter. The 10-year yield declined 1.4 basis points to 4.076%, according to Tradeweb data.Oil prices were broadly stable in early trade despite a broader market selloff and pressure from the stronger U.S. dollar. Gold futures in New York rose 0.9% to $3,991.60 a troy ounce amid a broader move to safe-haven assets and despite the higher dollar.Write to Barcelona Editors at [email protected]