Global Markets Drop on Fed Nomination, AI Concerns

Global stock markets declined sharply on Monday, driven by investor concerns over U.S. President Donald Trump's nomination of Kevin Warsh as the next Federal Reserve chair and fears of a potential bubble in artificial intelligence investments. The nomination, which requires Senate confirmation ahead of current Chair Jerome Powell's term ending in May, raised questions about the central bank's independence amid Trump's repeated calls for faster interest rate cuts.

In Asia, trading was particularly volatile. South Korea's Kospi index closed 5.3 percent lower at 4,949.67 after briefly halting due to sharp swings, reflecting its heavy weighting in technology stocks. Samsung Electronics shares fell 6.3 percent, while SK Hynix dropped 8.7 percent. The index had hit record highs in recent weeks, fueled by AI-related deals involving companies like Nvidia and OpenAI. Japan's Nikkei 225 index sank 1.3 percent to 52,655.18, giving up early gains. Hong Kong's Hang Seng fell 2.2 percent to 26,775.57, and Shanghai's Composite index declined 2.5 percent to 4,015.75. Australia's S&P/ASX 200 lost 1 percent to 8,778.60, and Taiwan's Taiex dropped 1.4 percent.

European markets opened with modest...