Asian technology stocks extend sell-off with SoftBank down 7% as AI plays take a hit

July 29, 2026 - 12:53

Asian technology stocks continued their downward spiral on Wednesday, with major semiconductor and AI-related companies taking the hardest hits. Japan's SoftBank Group tumbled more than 7%, dragging the broader market lower as investor sentiment soured on the artificial intelligence trade.

The selloff followed another rough session on Wall Street, where U.S. tech giants also lost ground. Concerns over high valuations, slowing growth in AI adoption, and rising interest rates have weighed heavily on the sector in recent weeks. South Korea's Samsung Electronics and SK Hynix both fell sharply, while Taiwan's TSMC dropped over 3% in early trading.

Analysts pointed to a broader rotation out of growth stocks into more defensive sectors. "The AI hype is cooling off as investors realize the timeline for meaningful revenue from these technologies may be longer than expected," said one market strategist in Hong Kong.

SoftBank, which has heavily invested in AI startups through its Vision Fund, has been particularly vulnerable. The stock has now lost nearly 15% over the past five trading sessions, wiping out billions in market value. Other Japanese tech names like Tokyo Electron and Advantest also saw steep declines.

The selloff has erased most of the gains made in the first quarter, raising questions about whether the AI rally has run its course. Some traders see further downside ahead, especially if U.S. inflation data due later this week comes in hotter than expected. For now, caution dominates as investors wait for clearer signals on the direction of both technology spending and monetary policy.