Shift of power in Congress weighs on Asian markets, tech shares suffer from fear of stricter AI rules
Tokyo loses almost 3 percent and European futures point to a lower open, as investors worry about the construction of data centres.
The Democratic gains in the US midterm elections put pressure on Asian stock markets on Wednesday morning. Tokyo's Nikkei was 2.85 percent lower around 06:00 Belgian time, and SoftBank Group, an investor in OpenAI, had earlier lost 8 percent, Euronews reports. Taiwan's Taiex fell 2.3 percent and South Korea's Kospi 1.17 percent. Euro Stoxx 50 futures were 0.7 percent lower. RTTNews also expects a clearly lower open in Europe.
Investors fear that a Congress with a Democratic majority will bring stricter rules and more scrutiny of AI companies, writes RTTNews. According to Euronews, opposition to data centres played a role in some campaigns, including the Senate race in Ohio. Chris Weston of Pepperstone points to the risk of political gridlock, new fights over the budget and the debt ceiling, and congressional investigations. In his view a narrow Democratic win was largely priced in, but a broad victory could make markets doubt the rest of Trump's agenda.
The euro traded at 1.1249 dollars. The German ten-year yield stood at 3.35 percent and the French at 4.93 percent, while the US ten-year hovered around 4.945 percent, according to Euronews. A barrel of Brent cost less than 104 dollars and gold gained almost half a percent to 3,958.50 dollars an ounce. On Tuesday the European Stoxx 600 had already closed 0.58 percent lower at 645 points, with mining and technology shares among the biggest losers, The Irish Times reports. Zalando lost 6.6 percent after a weaker gross margin and a net loss.