Bloomberg: July 17, 2026, Emerging-market equities fell for a second day and are headed for a weekly decline as concerns over stretched AI valuations dragged technology shares lower, triggering a selloff across Asia.
Will this round of sell-off reach the bottom by week 3 of July 2026?
MSCI’s gauge for developing markets dropped 1.8% and is down 3% for the week. Benchmark stock indexes in Japan and Taiwan, both heavy on technology shares, fell more than 3%, with AI bellwether Taiwan Semiconductor Manufacturing Co. sliding after a lofty spending forecast. An index of EM currencies edged lower while Bloomberg’s dollar spot index was little changed.
“Growing concerns over semiconductor valuations following their vertiginous rise through the end of June has pushed investors toward greater caution,” said Rajeev De Mello, global macro portfolio manager at Gama Asset Management SA. “Seasonally thinner liquidity during the Northern Hemisphere summer has amplified the selloff.”
The region-wide plunge in equities came even as South Korea’s Kospi index — the poster boy of the blistering AI rally and a gauge that’s seen wild swings — was closed for a holiday.
The fresh escalations in the war between the US and Iran also hurt risk sentiment, with a continued rise in crude prices stoking inflation and straining public finances for fuel importers. Oil is headed for its biggest weekly advance since April following the latest flare-up in tensions.
“The extended elevated oil prices have also started to weigh on net importing countries’ currencies, notably the Thai baht and the Indian rupee,” said Wee Khoon Chong, senior Asia-Pacific market strategist at BNY. The Thai currency was the worst performer among peers on Friday.
Meanwhile, India’s rupee is now approaching a record low, having surrendered most gains after authorities took steps to attract capital.
Source:
Bloomberg, July 17, 2026; https://www.bloomberg.com/news/articles/2026-07-17/em-stocks-headed-for-weekly-loss-on-tech-selloff-rising-crude
