Asian stock markets moved lower on Friday as optimism surrounding the semiconductor sector faded, while investors closely monitored ongoing discussions between U.S. President Donald Trump and Chinese President Xi Jinping in Beijing.
Technology and chip-related shares came under renewed pressure after comments from U.S. officials raised uncertainty over whether Washington may further ease restrictions on semiconductor exports to China.
South Korea’s stock market experienced the sharpest decline in the region, with the KOSPI index dropping 3.5%. Major semiconductor companies led the losses after U.S. Trade Representative Jamieson Greer stated that chip export controls were not a major focus during recent trade discussions with China.
The comments weakened investor enthusiasm that had been sparked earlier by reports suggesting that NVIDIA could potentially supply its H200 artificial intelligence chips to selected Chinese firms. Although no confirmed sales have been completed, global chip stocks had previously rallied on expectations of improved trade conditions.
Japanese semiconductor companies also traded lower, with technology-related shares facing broad selling pressure across the region.
Chinese markets, however, remained relatively stable near multi-year highs. Investors continued to assess the outcome of high-level meetings between Trump and Xi, as both sides signaled a willingness to improve economic cooperation between the world’s two largest economies.
According to recent statements, discussions reportedly included trade relations, energy purchases, and aviation deals, although officials have yet to provide full details regarding any formal agreements.
Meanwhile, Japanese markets were additionally pressured by stronger-than-expected producer inflation data. Rising oil and chemical prices contributed to the increase, reinforcing expectations that the Bank of Japan could face pressure to consider future interest rate hikes.
Japan’s Nikkei 225 index declined 1.6%, while Hong Kong’s Hang Seng Index also moved lower amid weakness in technology shares. Singapore’s Straits Times Index posted a modest decline as investors remained cautious ahead of further developments from the U.S.-China summit.
Overall, market sentiment across Asia remained fragile, with traders balancing hopes for improved U.S.-China relations against ongoing uncertainty surrounding global trade and semiconductor policies.
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