Asia tech stocks drop after Broadcom rattles AI trade and drags Wall Street names lower

June 5, 2026 - 06:22

Asian technology shares declined sharply on Monday, mirroring a selloff in U.S. semiconductor stocks after Broadcom's earnings report failed to impress investors, triggering a broader pullback from artificial intelligence-related names. The chipmaker's results, which showed slower growth in its AI infrastructure segment, dampened enthusiasm for the sector that had been a major driver of market gains over the past year.

Japan's Nikkei index fell more than 2%, led by losses in chip-equipment makers like Tokyo Electron and Advantest. South Korea's Kospi also dropped, with Samsung Electronics and SK Hynix both losing ground. Taiwan's benchmark index slipped, dragged down by Taiwan Semiconductor Manufacturing Co., which fell over 3% in early trade.

The rout extended beyond semiconductors. Other tech-heavy markets in the region, including Hong Kong and Shanghai, saw declines as investors reassessed valuations in the AI supply chain. Analysts noted that Broadcom's results highlighted a potential slowdown in capital spending by cloud providers, raising questions about the sustainability of AI-driven demand.

The selloff followed a rough session on Wall Street, where the Nasdaq Composite dropped nearly 2% on Friday. Broadcom shares tumbled more than 7% after the company reported quarterly revenue that missed estimates, despite a surge in AI-related sales. The disappointment weighed on other chip stocks, including Nvidia and AMD, which fell 3% and 4% respectively.

While some investors see the pullback as a healthy correction after a prolonged rally, others worry that the AI trade may be losing momentum. "The market is starting to question whether the massive spending on AI infrastructure will translate into profits anytime soon," said one Tokyo-based fund manager. For now, Asian tech stocks remain under pressure as traders await further earnings reports from the sector.