"Tension over 'AI Bubble' Spreads, Asia-Pacific Stocks Continue to Decline, Hang Seng Index Up 0.01%" | Lianhe Zaobao
After NVIDIA released its latest performance, concerns about the overheating of artificial intelligence investments intensified, leading to a general decline in the Asia-Pacific stock markets. The Singapore stock market performed relatively well, with the Straits Times Index rising slightly by 0.01%. The Shanghai stock market rose by 0.18%, while Taiwan and Seoul, due to the heavy weighting of technology stocks, fell by 0.66% and 0.61%, respectively. The Shenzhen, Hong Kong, Tokyo, and Sydney stock markets also experienced varying degrees of decline
As chip giant NVIDIA released its latest earnings, the market began to worry whether investments in artificial intelligence (AI) are "overheated," with some valuations possibly being too high, leading to heightened tensions and a shift in risk appetite. The Asia-Pacific stock markets were generally under pressure and declined on Wednesday (November 19); in contrast, the Singapore stock market showed resilience.
The FTSE Straits Times Index closed nearly flat on Wednesday, slightly up by 0.01% or 0.55 points, ending at 4505.22 points.
In other Asia-Pacific markets, Shanghai rose by 0.18%, while Taiwan and Seoul, which have a higher weight in the semiconductor and technology sectors, saw relatively larger declines of 0.66% and 0.61%, respectively; Shenzhen and Hong Kong fell by 0.5% and 0.38%; Tokyo closed down 0.34%; Sydney dropped by 0.19%.
Li Guangsheng, chief stockbroker at Phillip Securities, pointed out in an interview that multiple markets in the Asia-Pacific region are beginning to worry about the potential bursting of the "AI bubble." If U.S. tech stocks undergo a deeper correction, the spillover effects may continue to impact regional markets.
"If the U.S. market 'sneezes,' it is often difficult for the global market, including Singapore, to remain completely unaffected."
However, he further added that the constituents of the Singapore index are mostly high-dividend defensive companies, which tend to be more resilient to declines, and there are fewer high-valuation tech stocks; coupled with the solid funding base of the Singapore stock market and its industrial structure being somewhat different from other Asia-Pacific markets, the potential risk of an "AI bubble" may have limited direct impact on the index, resulting in a milder decline compared to regional markets.
The local stock market had a total trading volume of approximately 1.26 billion shares, with a total turnover of SGD 1.52 billion. There were 288 advancing stocks and 245 declining stocks.
Among the index constituents, 11 stocks fell, 13 rose, and six remained unchanged. The largest decline was seen in Genting Singapore, which fell by 2.6% to SGD 0.75; followed by DFI Retail Group, which closed at USD 3.42 (approximately SGD 4.46), down 1.44%; next was Keppel DC REIT, which dropped 1.28% to SGD 2.32. The remaining constituents saw declines ranging from 0.12% to 1.26%.
The largest gain was recorded by Yangzijiang Shipbuilding, which rose 2.76% to SGD 3.35; followed by Mapletree Industrial Trust, which increased by 0.99% to SGD 2.04; Jardine Matheson Holdings closed at USD 63.64, up 0.98%. Other constituents that rose saw gains between 0.04% and 0.95%
