Alphabet slide weighs on US tech as Asian markets diverge

Alphabet shares fell 12.6% Thursday, pulling the Nasdaq Composite down 1.4%. Indexes in Japan and South Korea were also lower in Friday afternoon trading as investors weighed the cost of artificial intelligence expansion.

The Nasdaq finished October 29 at 26,184.72. The S&P 500 fell 0.3% to 7,720.39, and the Dow Jones Industrial Average also lost 0.3%, closing at 52,342.56. The pressure was concentrated: four out of every five S&P 500 stocks rose, and the index would have gained without Alphabet’s decline.

By Friday afternoon in Asia, Japan’s Nikkei 225 was down 2.3% at 63,155.94 and South Korea’s Kospi was nearly 4% lower at 5,701.71. SK Hynix and Samsung Electronics also fell.

Elsewhere in the region, the picture was mixed. Australia’s S&P/ASX 200 rose 0.2% and Hong Kong’s Hang Seng gained 1.7%, while the Shanghai Composite slipped 0.4%.

The market reaction followed Alphabet’s October 28 quarterly results. In its earnings release, Alphabet reported revenue of $127.577 billion for the quarter ended September 30, up 25% from a year earlier. Google Cloud revenue reached $30.709 billion, up 103%.

Alphabet also reported $42.290 billion in operating cash flow and $51.355 billion in purchases of property and equipment. That left company-defined free cash flow at negative $9.065 billion for the quarter. The company attributed Google Cloud’s growth to demand for enterprise AI infrastructure and AI solutions, adding that sales of its TPU systems also contributed meaningfully.