Asian Markets Follow Wall Street Lower
Financial markets across Asia experienced a significant downturn on Friday, November 14, 2025, tracking heavy losses on Wall Street. The sell-off was primarily driven by two key concerns: growing uncertainty about the Federal Reserve's next interest rate decision and persistent speculation that the technology sector's rally may be overheating.
Federal Reserve Uncertainty Weighs on Sentiment
With the recent US government shutdown resolved, investor focus has sharply returned to the Federal Reserve's upcoming policy meeting in December. Officials are set to decide whether to lower borrowing costs again. For much of the year, stock markets have been buoyed by the expectation of falling interest rates, despite ongoing inflation. The Fed has delivered cuts at its past two meetings.
However, doubts have crept in following cautious comments from Fed Chairman Jerome Powell last month, who stated that a December cut was not a "foregone conclusion." This sentiment was echoed by several other Fed officials this week. Alberto Musalem, President of the St. Louis Fed, urged for "caution," noting limited room for further easing. Neel Kashkari from Minneapolis pointed to unexpected economic resilience, and Cleveland's Beth Hammack emphasized the need to keep rates "barely restrictive" to continue fighting inflation.
As a result, market expectations for a rate cut have recalibrated. Pepperstone analyst Chris Weston noted that the probability of a 25-basis-point cut on December 10 had fallen to 52%, down from 60% just a day earlier.
Tech Sector Jitters and Oil Price Surge
The dimming outlook for interest rates compounded existing worries about a potential tech bubble. This year's AI-fueled surge has propelled markets to record highs, but there is growing talk that the massive investments in artificial intelligence may take longer than expected to translate into profits. All eyes are on chip giant Nvidia's upcoming earnings report, which analysts see as a critical test for the sector.
On Wall Street, the three main indexes closed deeply in the red. The tech-heavy Nasdaq plummeted more than 2%, while the Dow and S&P 500 each fell 1.7%. Asia followed suit, with major indices posting losses:
- Tokyo's Nikkei 225 was down 1.7%.
- Hong Kong's Hang Seng Index fell 1.0%.
- Seoul's market, which had hit multiple records recently, shed more than 2%.
- Losses were also seen in Shanghai, Sydney, Taipei, Singapore, and Wellington.
In commodity markets, oil prices rallied sharply, surging more than 2%. This rebound was triggered by a warning from the International Energy Agency (IEA) about risks to Russian output due to hefty US sanctions, which it said could have the "most far-reaching impact yet on global oil markets." This surge came just days after prices had tumbled following an OPEC report forecasting an oversupply.
