Athens News - Tech stocks slide on AI jitters

"Global stock indices remained under pressure, weighed down by this week's technology stock sell-off as traders assessed increased AI infrastructure from China and its impact on US tech earnings," said Axel Rudolph, chief technical analyst at online trading and investing platform IG.

The selling came after Hock Tan, chief executive of the US semiconductor giant Broadcom, likened the AI buying frenzy to gambling.

"A lot of investors have no clue what they are investing in," Tan told a conference in Singapore, saying they "set very extreme expectations only to find out that it's almost like they are in a casino".

The International Monetary Fund weighed in on the debate, warning of an AI correction at the beginning of its annual meeting in Bangkok.

The boom in artificial intelligence -- and the related rush to manufacture semiconductors and build data centres -- has provided a boost to global growth despite geopolitical pressures including the Middle East war.

But "growing evidence suggests that AI capabilities can be delivered at lower investment levels... or that potential economic gains may not be as large as expected", the IMF said in its Global Financial Stability Report.

The IMF forecast that global growth in 2026 would slow less than previously expected because of advanced economies' "resilience" in the face of war-fuelled energy prices, but warned that low-income countries remained vulnerable to the supply shock.

On the trading floors, South Korea's Kospi stocks index tanked 5.5 percent by the close as chip titans SK hynix and Samsung took a beating.

The decline also followed reports that China's CXMT had made progress on new technology to boost memory chip density, which rival firms have also been racing to achieve.

The company is aiming to release a new server-memory product based on the structure by the end of the year, the reports said.

"The tech sector is taking it on the chin," said Trade Nation analyst David Morrison, noting that the CXMT development suggests that going forward supplies of a key type of memory chips might not be as tight as many investors had thought.

"The news also provided investors with an excuse to cut their exposure to AI-adjacent companies," Morrison added.

Japanese stocks also slumped, with chipmaker Kioxia tumbling more than 13 percent on the Nikkei 225, which lost 1.8 percent.

The losses continued on Wall Street, with the tech-heavy Nasdaq Composite shedding 0.3 percent in late morning trading in New York.

Shares in AI chip giant Nvidia were down 0.7 percent while those in Micron fell more than five percent.

The Philadelphia Semiconductor Sector index, which groups most of the major players in the chip industry, was down around two percent.

The losses in the tech sector overshadowed a positive start to the third-quarter earnings season.

Shares in JPMorgan Chase rose 1.0 percent after boosting profits by six percent.

Shares in Goldman Sachs climbed 1.5 percent after the bank beat expectations with a 33-percent jump in profit.

- Key figures at around 1530 GMT -

New York - Dow: DOWN 0.2 percent at 52,220.05 points

New York - S&P 500: DOWN 0.2 percent at 7,788.80

New York - Nasdaq Composite: DOWN 0.3 percent at 27,153.74

London - FTSE 100: DOWN less than 0.1 percent at 10,650.33 (close)

Paris - CAC 40: DOWN less than 0.1 percent at 7,827.63 (close)

Frankfurt - DAX: DOWN less than 0.1 percent at 25,259.90 (close)

Seoul - Kospi: DOWN 5.5 percent at 6,035.35 (close)

Tokyo - Nikkei 225: DOWN 1.8 percent at 67,777.52 (close)

Hong Kong - Hang Seng Index: UP 0.3 percent at 24,345.22 (close)

Shanghai - Composite: UP 0.1 percent at 3,800.86 (close)

Brent North Sea crude: DOWN 0.9 percent at $105.66 per barrel

West Texas Intermediate: UP less than 0.1 percent at $93.79 per barrel

Euro/dollar: UP at $1.1195 from $1.1156 on Monday

Pound/dollar: UP at $1.3246 from $1.3207

Dollar/yen: DOWN at 158.41 yen from 158.68 yen

Euro/pound: UP at 84.52 pence from 84.48 pence

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B.Tsoukalis--AN-GR