Asian markets fell on Thursday, December 11, 2025, as technology stocks led declines following Oracle’s weaker-than-expected second-quarter revenue and increased capital expenditures. Despite dovish monetary signals from the Federal Reserve, including a 25 basis point interest rate cut and a $40 billion monthly Treasury buying plan, investor caution persisted. Broader unease around artificial intelligence (AI) spending and geopolitical strains between Japan and China intensified market headwinds.

Technology Sector Bears Brunt of Market Weakness

Oracle’s shares plummeted more than 10% in after-hours trading after it reported disappointing Q2 revenue results, highlighting softness in its software segment and a significant rise in capital expenditures. This report reignited concerns over the sustainability of AI-driven investment. Nvidia, a major AI chipmaker, slid over 1%, amplifying the negative sentiment across technology stocks worldwide. U.S. futures also reflected this mood, with S&P 500 futures down 0.8% and Nasdaq 100 futures retreating 1.1% during Asian trading hours.

In Japan, technology and AI-centric industrial shares were notably weak, dragging the Nikkei 225 down 0.8% and TOPIX by 0.7%. SoftBank Group, with its significant exposure to Oracle and OpenAI, declined over 8%, marking the largest drop on the Nikkei. These moves underscore mounting investor skepticism about the near-term outlook for AI expenditure among tech giants.

Regional Market Divergence Amid Sectoral and Geopolitical Pressures

While technology shares struggled, non-tech sectors in Asia showed modest gains. Singapore’s Straits Times index rose 0.3%, and Australia’s ASX 200 increased 0.2%, buoyed by weaker labor market data that sharpened bets on potential Reserve Bank of Australia rate cuts. India’s Nifty 50 climbed 0.2%, supported by its smaller exposure to tech sector volatility.

Conversely, Chinese and Hong Kong markets slid. The Shanghai Composite fell 0.5%, and the CSI 300 lost 0.2%, while Hong Kong’s Hang Seng index held steady. The semiconductor industry faced additional strain amid rising competition after Nvidia’s approval to export more advanced AI chips to China. China’s leading chipmakers Semiconductor Manufacturing International Corp and Hua Hong Semiconductor each fell about 2.5%. Taiwan Semiconductor Manufacturing Company (TSMC) shares dropped 2.3% following a November sales decline month-over-month.

Geopolitical tensions added complexity as friction between Tokyo and Beijing intensified due to comments by Japanese Prime Minister Sanae Takaichi on Taiwan. Despite these challenges, optimism about Nvidia’s expanded AI chip sales in China helped lift some Japanese suppliers like Advantest Corp, which gained as much as 4%.

Fed’s Dovish Move Provides Partial Support to Markets

The U.S. Federal Reserve’s decision to cut interest rates by 25 basis points and initiate a $40 billion monthly Treasury note purchase program signaled a looser monetary policy stance. Fed Chair Jerome Powell emphasized a cautious approach toward further cuts but aimed to improve liquidity and economic growth prospects. This dovish turn lent some stability to non-technology sectors across Asian markets; however, concerns over AI spending trends and geopolitical risks limited broader market gains.

Markets remain vigilant as earnings releases, economic data, and geopolitical developments continue to influence investor sentiment heading into 2026. The combination of mixed corporate earnings, central bank policies, and regional geopolitical tensions are keeping Asian markets under pressure.