Asian shares slide post Broadcom forecast, oil prices slip

Asian shares decline as the AI-fueled rally which powered global equities to fresh highs lost momentum post a weak forecast from Broadcom Inc.

The MSCI Asia Pacific Index declined 0.9% with South Korea dropping 1.6%. Futures contracts for the Nasdaq 100 Index retreated 0.5% as chipmaker Broadcom tumbled 14% in extended trading after its outlook failed to impress investors.

Asian losses followed a pullback on Wall Street, where the S&P 500 snapped a nine-day winning streak as renewed US-Iran clashes damped risk appetite. Elsewhere, Bitcoin slid 2.8% to trade around $63,000.

Some relief emerged early Thursday after the US announced a ceasefire between Israel and Lebanon, helping Brent crude halt a three-day rally and fall 0.9% to trade under $97.00 a barrel. The Bloomberg gauge of the dollar also edged lower.

Broadcom’s disappointing outlook is testing the durability of the artificial-intelligence rally that has driven global equities, especially semiconductor stocks, to record highs. At the same time, renewed geopolitical tensions and persistent concerns about higher-for-longer interest rates are also weighing on sentiment.

The rally in artificial-intelligence stocks paused on Wednesday as the risk-on mood started to dissipate. UBS Group AG’s basket of AI winners fell 1.4%, snapping a four-session winning streak.

Some investors also warned that the booming artificial-intelligence market is showing signs of a bubble that will eventually burst.

Elevated oil prices and signs of resilience in the US labor market sent Treasuries lower Wednesday, as traders increased bets that the Federal Reserve’s next move will be to raise interest rates. Bonds gave up some of those losses early Thursday.

In Asia, the yen hovered near the 160-per-dollar level after comments from Bank of Japan Governor Kazuo Ueda that make an interest rate hike this month sound likely but not certain.

Meanwhile, data showed US companies added the most jobs since January 2025, suggesting hiring momentum remains intact despite higher energy costs. If confirmed by Friday’s payrolls report, the figures may reinforce expectations that the Fed is more likely to raise rates in the months ahead.

Investors will get another read on the labor market on Thursday with weekly jobless claims, ahead of the government’s monthly employment report on Friday.

Fed Bank of Dallas President Lorie Logan said policymakers may need to raise rates later this year to bring inflation back to target. Separately, New York Fed President John Williams told Yahoo Finance that the outlook for rates remains uncertain.

With inputs from Bloomberg