Fri, Dec 01, 2017 - Page 10 News List

Tech leads Asian market tumble

SHARP LOSSES:Selling of tech in the US flooded through to Asia as investors fret over recent rallies resulting in record highs, although Tokyo bounced back on a weaker yen

AFP, HONG KONG

Technology firms across Asia yesterday tumbled, dragging most markets in the region into the red, following sharp losses in shares of major US firms including Apple Inc and Netflix Inc.

The retreat is the latest to hit Asia as investors fret over a recent rally that has sent several indices to record highs, although a surprise jump in a gauge of Chinese factory activity provided some support to Shanghai.

While Wall Street saw the Dow chalk up a fresh record after strong US economic growth figures were announced, the NASDAQ took a hammering with analysts pointing to a technical shift ahead of a US Senate debate on tax cuts this week.

“The prospect of US tax cuts actually being passed appears to have prompted a value rotation away from the ‘FANG’ stocks and the tech-heavy NASDAQ and back toward financials and other sectors of the market that would benefit if the tax bill does indeed pass into law,” AxiTrader chief market strategist Greg McKenna said.

FANG refers to tech titans Facebook Inc, Apple, Netflix and Google — now trading as Alphabet Inc — which have been at the forefront of a market surge in the sector this year.

The selling flooded through to Asia, where Samsung Electronics Co dived 3.4 percent and Sony Corp lost 2.3 percent. Tencent Holdings Ltd (騰訊) — which recently joined the US$500 billion market value club — was down 3 percent in Hong Kong, where AAC Technologies Holdings Inc (瑞聲) plunged 6.4 percent.

On broader markets, Hong Kong was down 1.30 percent, while Shanghai ended down 0.6 percent.

Seoul sank 1.5 percent, hit by the dive in heavyweight Samsung and after the Bank of Korea hiked interest rates for the first time in six years, while Sydney was off 0.7 percent after news that an independent inquiry into Australia’s financial services sector had been set up in a bid to quell public anger at the massively profitable banking system.

Singapore, Taipei and Jakarta also suffered sharp losses.

However, Tokyo bounced back from morning selling to end 0.6 percent higher as a weaker yen fueled hope for better earnings for Japan’s exporters.

The US dollar rallied against the yen as optimism about the progress of tax reform was mixed with news that the US economy had enjoyed its best growth in three years, reigniting expectations for higher US borrowing costs during the next year.

The British pound extended its rally against the US dollar following reports that British and EU negotiators were close to a divorce settlement deal.

Bitcoin was holding above the US$10,000 mark it broke for the first time on Wednesday, but was well down from the record US$11,434 it touched briefly in US trade.

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