Asia tech stocks plummet on AI bubble fears

Japanese and South Korean tech stocks plummeted on Friday, with tech investor SoftBank plunging more than 10 percent as fears over an AI bubble weigh on the market.

Seoul's benchmark Kospi index was trading down nearly four percent, while Tokyo's Nikkei index shed 2.3 percent in morning trade. 

It followed a downbeat session on Wall Street after US jobs data clouded hopes of further interest rate cuts and fears about whether AI-fuelled valuations are justified.

Samsung Electronics shed 4.8 percent and SK hynix plunged more than nine percent. The firms are two of the world's leading memory chip makers.

Downturn

The downturn comes a day after Asian stocks jumped thanks to AI bellwether Nvidia's earnings report. 

Investors cheered the earnings released late Wednesday, which topped expectations on fierce demand for advanced chips.

Chief executive Jensen Huang brushed off fears of an artificial intelligence bubble.

Tech equities

Multibillion-dollar investment into AI has been a key driver of the global surge in mostly technology equities, sending valuations to record highs.

AI-related spending is expected to reach approximately $1.5 trillion by 2025, according to US research firm Gartner, and over $2 trillion in 2026 -- nearly two percent of global GDP.

Geopolitical tensions are helping drive the frenzy, primarily to build data centres housing tens of thousands of expensive chips that require phenomenal electrical power and energy-hungry cooling.