Stocks rebound after tech sell-off and Indonesia shares sink on market
downgrade warning
[October 16, 2026] By
CHAN HO-HIM
HONG KONG (AP) — World shares mostly advanced Friday, a day after a tech
sell-off dragged Asian stocks sharply lower. Indonesia’s stock market,
however, plunged following a downgrade warning.
Index provider MSCI warned it would downgrade Indonesia from its
“emerging market” status, triggering growing concerns of capital flight.
U.S. futures edged higher after Federal Reserve chair Kevin Warsh said
the artificial intelligence shock could bring huge benefits to the
global and U.S. economies.
In Europe, Britain's FTSE 100 fell less than 0.1% to 10,836.46 in early
trading. France's CAC 40 edged 0.2% higher to 7,947.74, while Germany's
DAX rose 1% to 25,632.39.
Over in Asia, South Korea’s benchmark Kospi index jumped 2.1% to
5,668.05, after tumbling 7.6% the day before on a sell-off of shares
related to artificial intelligence. Samsung Electronics was up 2.6%,
while memory chipmaker SK Hynix added 0.8%.
Japan’s Nikkei 225 rose 1.4% to 65,324.29, after falling 4.9% a day
earlier. OpenAI investor SoftBank Group climbed 1.9%. Chip equipment
maker Tokyo Electron was 2.6% higher and memory chipmaker Kioxia
Holdings advanced 3.8%.
The Asian technology stocks traded higher after losses in AI shares
moderated in the U.S.
Warsh said Friday at the IMF and World Bank gathering in Bangkok that AI
could bring about positive impacts to global economies.
“I’d say the advent of this new technology is probably the most
consequential change to the U.S. and the global economy in my lifetime,”
Warsh said. “There really is, I think, a huge benefit to the global
economy, the U.S. economy, over the horizon.”
Taiwan’s Taiex, which also benefited from the AI frenzy, was up 0.3%.
But shares of TSMC, or Taiwan Semiconductor Manufacturing Co., were 0.8%
lower even as it posted record quarterly profits on Thursday and said AI
demand remained very strong.
In Indonesia, the Jakarta Composite index fell more than 11% after MSCI
said Indonesia’s continued classification as an emerging market would be
“no longer appropriate." That was its largest single-day decline since
1998, according to Trading Economics.
Hong Kong’s Hang Seng gained 0.5% to 24,186.83. The Shanghai Composite
index edged up 0.2% to 3,716.28.
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People walk past an electronic screen displaying stock prices at the
Indonesia Stock Exchange in Jakarta, Friday, Oct. 16, 2026. (AP
Photo/Tatan Syuflana)
 Australia’s S&P/ASX 200 was 1%
higher at 8,806.70.
India’s Sensex rose 0.4%.
On Thursday, Wall Street’s benchmark S&P 500 added 0.3%. The Dow
Jones Industrial Average jumped 1.1%, and the technology-heavy
Nasdaq composite rose 0.1%.
AI and chip stocks had eased their losses. American AI cloud
provider CoreWeave plummeted as much as 9.5% in early trading but
flipped later and ended 5.9% higher. Nvidia closed 1.8% lower
following an earlier loss that reached 3.8%. Broadcom was down 0.6%,
and AMD, or Advanced Micro Devices, was 1.5% lower.
Oil prices steadied but continued to stay elevated as global oil
supply remains under pressure without a deal between the U.S. and
Iran to end the Iran war.
The International Energy Agency also said Thursday its members
agreed to release in a timely manner the remaining about 100 million
barrels of oil outstanding from its pledge in March and that the
release total amount to be released would exceed the original 400
million barrels planned.
Brent crude, the international standard, fell 0.6% to $105.26 per
barrel. That is still high compared with around $72 a barrel in late
February before the start of the war.
Benchmark U.S. crude was down 0.9% to $97.11 per barrel.
Oil remains well-supported as uncertainties surrounding the
situation in the Middle East and concerns over oil flows in the
Strait of Hormuz had the market “pricing in a significant risk
premium,” ING commodities strategists Warren Patterson and Ewa
Manthey wrote in a commentary Friday.
The U.S. dollar fell to 157.96 Japanese yen from 158 yen. The euro
was trading at $1.1255, up from $1.1220.
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