AI Bubble Fears Trigger Global Semiconductor Stock Rout

Global stock markets declined on November 21, 2025, as investors reacted to fears of an artificial intelligence bubble and an ambiguous U.S. labor market. Despite strong third-quarter earnings and a bullish outlook from Nvidia, the company's stock fell over 3% in the U.S., triggering a wider technology sell-off. This downturn hit Asian markets severely, with Japan's Nikkei dropping over 2% and South Korea's Kospi plunging nearly 4%.

The semiconductor sector saw a significant rout in Asia. SoftBank Group shares sank over 10% in Tokyo, while other major players including SK Hynix, Samsung Electronics, and TSMC experienced drops ranging from 4.81% to 8.76%. Analysts linked the volatility to tighter financial conditions, a Bitcoin sell-off, and a risk-off rotation driven by AI investment concerns.

Market instability coincided with uncertainty regarding the Federal Reserve System's December interest rate plans following a mixed September jobs report. Fed officials Beth Hammack and Lisa Cook warned that further rate cuts carry economic risks and could lead to outsized asset price declines. In Japan, Prime Minister Sanae Takaichi planned a stimulus package exceeding 20 trillion yen, the largest since the pandemic, which put downward pressure on the yen.