Asia stocks climb tracking Wall St rally; Nikkei hits record high, China GDP beats
Oracle’s (NYSE:ORCL) sharp decline in afterhours trading disrupted the post-Fed calm and put new pressure on global technology markets. The stock fell more than eleven percent after the company reported revenue and operating income below expectations. This setback arrived only hours after U.S. equities rallied on the Federal Reserve’s quarter-point rate cut, as investors viewed Chair Powell’s comments as dovish despite three officials opposing the decision.
The new concern is whether the AI-driven expansion in cloud and data-center spending can justify the valuations that have dominated this year’s market leadership. Oracle confirmed a plan to increase capital expenditure by fifteen billion dollars to expand data-center capacity. Investors had expected a stronger top-line performance to validate this scale of investment. When the numbers came in soft, the immediate reaction was to reassess how much near-term revenue the AI buildout can actually deliver. The shift in sentiment interrupted the relief rally that followed the Fed cut and pushed investors back toward risk control rather than momentum.
The impact was broad and immediate. Europe opened lower as the selloff in Oracle’s shares fed directly into the region’s tech complex. The AEX fell 0.5 percent. The DAX lost 0.4 percent. SAP slipped 2.9 percent. The Stoxx Europe 600 Technology index moved down 0.8 percent and the main Stoxx 600 eased 0.2 percent. Italy’s FTSE MIB declined 0.3 percent despite gains in luxury names such as Brunello Cucinelli and Moncler. The FTSE 100 slipped 0.1 percent as investors positioned more cautiously around global growth signals.
Asia had already closed weaker. The Nikkei edged down 0.1 percent, driven by a 7.7 percent drop in Softbank’s shares. The Kospi lost 0.6 percent. SK Square fell 5.1 percent and SK Hynix weakened after the Korea Exchange warned that the stock price had run ahead of fundamentals. China also retreated. The Shanghai Composite slipped 0.7 percent and both Shenzhen and ChiNext ended 1.4 percent lower as domestic liquidity concerns continued to weigh on risk appetite.
Investors will now watch how upcoming earnings from Broadcom shape the next stage of market positioning. Strong guidance could stabilize sentiment and confirm that AI-infrastructure demand remains intact. A weaker update would amplify the concerns triggered by Oracle’s numbers and extend the adjustment across the global tech supply chain. The bond market also remains a key influence. If yields drift lower, the impact of the tech correction may stay contained. If yields rebound higher, equity volatility could rise as positioning tightens around the Fed’s policy path.
The broader takeaway is that the AI boom still commands investor interest, but the tolerance for earnings misses is narrowing. Traders should view the latest reaction as a reminder that valuation risk is rising and that confirmation from corporate earnings is becoming more important than macro policy signals.