AI Selloff Spreads Across Asia. Gold Finds Support as Investors Cut Risk

Wall Street’s tech rout is no longer just a US story. After the Nasdaq plunged 5.5% on Thursday, the selloff spread across Asia on Friday. South Korea’s KOSPI fell more than 8% at one point, triggering a temporary trading halt, while Japan’s Nikkei 225 approached bear-market territory.

The trigger is growing concern over the AI boom. Investors are questioning whether massive spending on data centres and chips can deliver the returns expected, prompting a broad retreat from technology stocks.

Gold is beginning to benefit from the shift in sentiment. US Treasury yields fell as investors moved towards safer assets, reducing the opportunity cost of holding non-yielding bullion. Spot gold gained around 0.7% to $4,088 in

Thursday’s US session.

But the rally is not guaranteed to accelerate. If investors are forced to sell assets to cover losses or raise cash, gold could also face short-term pressure. A stronger US dollar would add another obstacle.

For XAU/USD traders, the next signal is whether falling Treasury yields and safe-haven demand can outweigh any renewed demand for cash. If both remain supportive, gold could find room to extend its recovery.