Asian Stock Markets Face Unsteady Recovery After Major Selloff

Asian stocks showed signs of recovery on Wednesday following a severe selloff as market volatility reached levels unseen since April. The downturn, led by tech stocks on Wall Street, raised concerns over inflated valuations. While Tokyo and South Korean markets bore the brunt early on, they managed to claw back some losses.

The Tokyo stock index, after dropping nearly 7% from Tuesday's record high, ended the session down 2.8%. South Korean shares fell by as much as 6.2% before settling at a 3% drop. The Asian-Pacific index also faced its steepest decline since the early April tariff announcement by the U.S. President, dropping 1% by session's end.

Investor anxiety rose as CEOs from major financial institutions like Morgan Stanley and Goldman Sachs questioned the sustainability of high valuations, echoing warnings from JPMorgan Chase's CEO Jamie Dimon about potential corrections. Coupled with gains from AI enthusiasm, the markets seemed vulnerable to shifts, drawing parallels to the dotcom bubble.