Asian equities were mixed on Friday as the optimism over a possible pause in US Federal Reserve interest rate hikes again gave way to worries about the global economy as more than a year of monetary tightening starts.
Traders were expecting losses at the Wall Street open after Apple Inc, Amazon.com Inc and Google owner Alphabet Inc — who together are worth almost US$5 trillion — indicated following Thursday’s close that high interest rates and sky-high inflation were weighing on consumer demand.
Hong Kong led losses in Asian trading, with the Hang Seng down 1.36 percent at 21,660.47, falling 4.53 percent for the week. The Shanghai Composite Index was down 0.68 percent to 3,263.41, dropping 0.04 percent weekly.
Photo: EPA-EFE
In Taipei, the TAIEX closed up 7.5 points, or 0.05 percent, at 15,602.66 on turnover of NT$237.27 billion (US$7.93 billion). It was up 4.48 percent from last week.
Japan’s benchmark Nikkei 225 added 0.39 percent to finish at 27,509.46, up 0.46 percent for the week, while the broader TOPIX gained 0.26 percent to close at 1,970.26, down 0.63 percent from last week.
Australia’s S&P/ASX 200 rose 0.62 percent to 7,558.1, up 0.86 percent weekly, while South Korea’s KOSPI added 0.47 percent to 2,480.40, down 0.15 percent for the week.
India’s S&P BSE SENSEX rose 1.52 percent to 60,841.88, gaining 2.55 percent from last week.
Interest rates and inflation concerns overshadowed optimism about China’s reopening and recovery from nearly three years of “zero COVID” policies that hammered business activity.
They also offset the positive mood created by an acknowledgement from the Fed that it was making progress in bringing inflation down from multidecade highs, fueling hopes it was nearing the end of its rate hike cycle.
Markets on Friday were also pricing in fresh geopolitical concerns after the Pentagon said that Beijing flew a spy balloon over the US.
“Futures are pointing towards weakness on Wall Street later, reversing the gains it made before the afterhours shockers from Apple, Amazon and Alphabet,” AJ Bell investment director Russ Mould said.
Apple said that sales dropped more than expected in the October-to-December period, Amazon’s revenue was hit by weak consumer demand and Alphabet results fell short of estimates.
“The war in Ukraine, inflationary pressures, economic uncertainty and macroeconomic headwinds kept the consumer sentiment weak in 2022 while smartphone users reduced the frequency of their purchases,” Counterpoint Research senior analyst Harmeet Singh Walia said in a report on Apple.
In India, conglomerate Adani Enterprises Ltd fell further.
Beleaguered Indian tycoon Gautam Adani on Friday denied that his rise to become Asia’s richest man — a title he has lost in a phenomenal stock rout last week — was thanks to Indian Prime Minister Narendra Modi.
Combined market capitalization in Adani’s listed units has collapsed by about US$120 billion — or half their previous value — since US short-seller Hindenburg Research, which makes money by betting on shares falling, released an explosive report last month.
It accused Adani of accounting fraud and artificially boosting its share prices, calling it a “brazen stock manipulation and accounting fraud scheme,” and “the largest con in corporate history.”
Critics say Adani’s close relationship with Modi, who is also from Gujarat state, has helped him win business and avoid proper oversight.
Adani on Friday called the allegations “baseless.”
Additional reporting by staff writer with CNA
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts