London (AFP) - Technology shares plunged Friday after an unnerving rout on Wall Street as fears grew that Democrats would accelerate a backlash against AI after their crushing defeat of President Donald Trump’s Republicans in the US midterms.

The Tokyo and Seoul stock markets closed out their weeks with losses of six percent following the Nasdaq’s 5.5 percent collapse on Thursday, its worst showing since April last year when Trump unveiled his wide-ranging global tariffs.

“The tech sell-off has intensified, with the pain of the brutal sell-off on Wall Street carried straight through to Asia and knocking sentiment in Europe,” said Susannah Streeter, chief investment strategist at Wealth Club.

“Big worries are colliding – the build-out of data centres looks set to slow, which risks shredding the spending spree underpinning the boom, right at the time that investors have become super nervous about returns on this massive investment,” she said.

The London, Paris and Frankfurt stock markets shed around two percent nearing the halfway stage despite featuring few technology firms.

Elsewhere, the dollar firmed before key US jobs data Friday, and oil prices steadied following steep declines this week.

Futures contracts pointed to a rebound on the Nasdaq later this afternoon, but further declines for the broad-based S&P 500.

Data centres have faced broad opposition from US voters across the political spectrum, and many midterm winners have pledged to put the brakes on such projects.

Analysts said investors were also spooked by a call from progressive US Senator Bernie Sanders for a national moratorium on their building.

The results compounded already heightened fears about the hundreds of billions firms had pumped into the sector and when they would see a return, while the recent spike in borrowing costs also fuelled concerns about their financial position.

Bloomberg said the Philadelphia Semiconductor Index had collapsed around 16 percent this week, putting it on course for its worst run since April last year.

On Seoul’s Kospi stocks index, chip giant SK hynix slumped 10 percent and its rival Samsung lost 6.4 percent.

The Kospi more than doubled in value between the end of December and mid-June, when it hit a record, but is down almost 50 percent over the past four and a half months.

Tokyo dived six percent Friday as Japanese tech investor SoftBank gave back more than 10 percent, while chipmaker Kioxia collapsed 8.7 percent and semiconductor tester Advantest retreated five percent.

A 4.7 percent drop for Taiwanese chip giant TSMC dragged down Taipei’s Taiex.

“The blood is in the streets, folks,” wrote Neil Wilson, analyst at Saxo Markets, though he added that the sell-off looked “overdone”.

“The fear is a total momentum unwind as Democrats pace the frontier and kibosh data centre build-out,” he said.

- Key figures at around 1015 GMT -

London - FTSE 100: DOWN 2.2 percent at 10,542.88 points

Paris - CAC 40: DOWN 1.8 percent at 8,057.43

Frankfurt - DAX: DOWN 2.3 percent at 25,709.82

Tokyo - Nikkei 225: DOWN 6.0 percent at 57,434.77 (close)

Seoul - Kospi: DOWN 6.0 percent at 5,059.69 (close)

Hong Kong - Hang Seng Index: DOWN 1.3 percent at 24,481.86 (close)

Shanghai - Composite: DOWN 1.1 percent at 3,649.18 (close)

New York - Dow: DOWN 3.4 percent at 51,523.06 (close)

New York - Nasdaq: DOWN 5.5 percent at 24,315.00

Brent North Sea crude: DOWN 0.1 percent at $98.20 per barrel

West Texas Intermediate: UP 0.1 percent at $90.64 per barrel

Euro/dollar: DOWN at $1.1178 from $1.1222 on Thursday

Pound/dollar: DOWN at $1.3397 from $1.3454

Dollar/yen: UP at 158.24 yen from 157.83 yen

Euro/pound: UP at 83.44 pence from 83.41 pence

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