Asian Markets Slide as Hot US Inflation Hits AI Stocks

Asian markets fell sharply Thursday after hotter-than-expected US inflation data raised expectations of Federal Reserve interest rate hikes, with MSCI's Asia-Pacific index dropping 1.2% and South Korea's KOSPI plunging 5.6%. The selloff was led by technology and AI-related stocks sensitive to higher borrowing costs, with Wall Street's S&P 500 falling 1.1% and the Nasdaq tumbling 1.9% overnight. Fed funds futures now price a 31.6% probability of a rate hike at the October 28 meeting, up from 22.1% a day earlier. Investor attention turns to Fed officials' speeches in Bangkok and US producer prices data due Thursday, while AI chip giant TSMC releases third-quarter earnings later in the Asian session.