ASX ends lower as global tech rout deepens after US midterm AI fears

The ASX 200 finished at 9,020 points, with Materials falling 3 percent, Technology dropping 1.4 percent and Consumer Discretionary losing 0.7 percent. Consumer Staples rose 1 percent, Financials gained 0.5 percent and Utilities added 0.3 percent. Among the big four banks, NAB rose 2.7 percent, Westpac 1.5 percent, CBA 0.9 percent and ANZ 0.4 percent.

The sell-off follows a brutal session on Wall Street where the Nasdaq Composite fell 5.5 percent, wiping an estimated $2.5 trillion in market value, as investors reassessed the implications of the Democratic midterm victories for AI infrastructure. The S&P 500 fell 4.4 percent and the Dow Jones lost 3.4 percent. The Philadelphia Semiconductor Index plunged more than 12 percent.

In Asia, tech-heavy indexes fell sharply. South Korea's Kospi tumbled more than 8 percent, triggering a circuit breaker, before recovering to be down 4.4 percent. Japan's Nikkei 225 fell 5.9 percent, Taiwan's benchmark lost more than 8 percent, and Hong Kong's Hang Seng slipped 1.2 percent. Samsung Electronics fell nearly 10 percent, SK Hynix slid 11.7 percent, and TSMC dropped 8.5 percent.

On the ASX, the biggest decliners included News Corporation, down 9.4 percent, and Vulcan Energy Resources, down 8.9 percent. Among the gainers, Nine Entertainment rose 11 percent, Amcor 5.1 percent, and NEXTDC 3.6 percent. The Australian dollar fell 0.5 percent to 68.93 US cents.

Qantas flagged fare increases and capacity cuts, saying fuel prices are expected to remain elevated through FY27. The carrier said its first-half fuel cost is now expected to be about $3.75 billion, and it has extended hedging to about 85 percent of its annual fuel bill.

About 600,000 of Nvidia's advanced H200 AI chips are stored in Hong Kong awaiting shipment to mainland China, as Beijing withholds approval for large-scale imports despite demand from Chinese tech firms, according to two people familiar with the matter.

Betashares chief economist David Bassanese said that while the market behaviour was "perplexing", the investment outlook for AI still appeared strong. "Either way, while there may be some extra conditions placed on the data centre rollout in some US states (such as insisting they generate their own electricity), the investment outlook still appears strong."

Yongxin Xu, a senior lecturer at Monash University, said the bigger story for Australia was not the ASX's muted hit but the restriction on AI access. "Australia has no frontier large language model of its own," he said. "Our firms and households rely on US-developed AI models, so changes to regulation could restrict what we can access." He added that the sell-off repriced AI regulatory risk but did not end the AI boom. "AI is unstoppable," Dr Xu said, adding it is now a race between nations and central to national security.

US President Donald Trump blamed the slide on Democrats in a social media post, saying: "The Stock Market suffered one of the Worst Days in History based on the results of the Election. ... Do not fear, however, we will soon, one way or the other, be BIGGER AND STRONGER THAN EVER BEFORE."

Senator Bernie Sanders called for a national data centre moratorium, saying: "Americans don't want Big Tech oligarchs wrecking the environment, gutting jobs and threatening humanity's future."

OpenAI president Greg Brockman said he believed everyone had been surprised by the backlash against data centres, and more work was needed to ensure communities were on board. "A lot of our shift over the course of this year has really been to realise that from San Francisco trying to build infrastructure in Texas, Georgia, and other places, you can't just tweet and say: 'This is going to be good.' You need to be in those communities," Brockman said at the WSJ Tech conference.