Asian stocks were in the red on Tuesday with investors continuing to exit China over worries about its stumbling recovery while tech stocks came under pressure too from muscular US Treasury yields.
Shares across the region slipped to three-week lows and Hong Kong’s Hang Seng index slumped to a one-year trough as trader optimism on cuts to US interest rates faded ahead of US jobs data later in the week.
Japan’s Nikkei share average posted its steepest drop in nearly six weeks on Tuesday, as elevated US Treasury yields drove a heavy sell-off in Advantest and other chip-related stocks.
Also on AF: Push for Phase-Out of Fossil Fuels on the Table at COP28
US stocks had ended lower on Monday, with megacaps Microsoft, Apple, Nvidia and Amazon dipping over 1%, pressured by higher US 10-year yields ahead of key employment data due this week.
The benchmark Nikkei average closed down 1.37% at 32,775.82, its biggest single-day fall since October 26. The index touched a three-week low of 32,726.68 during the session. The broader Topix fell 0.84% to 2,342.69.
Most of the Nikkei’s top losers were chip-related stocks, with Advantest down 6%, Tokyo Electron falling 3.8% and Screen Holdings slipping 5%. Renesas Electronics also fell 5%.
China stocks fell as mixed economic data elevated concerns about the country’s growth, with investors cautiously awaiting economic indicators and policy meetings for more clues.
China and broader emerging Asia market stocks were among the most net sold regions by global hedge funds in November, Goldman Sachs said, as fund managers further reduced exposure to the world’s second-largest economy.
The blue-chip CSI 300 Index lost 1.90%, and the Shanghai Composite Index was down 1.67%, or 50.62 points, to 2,972.30. The Shenzhen Composite Index on China’s second exchange retreated 1.95%, or 36.62 points, to 1,845.03.
Most sectors declined, with real estate developers, semiconductors and computers down between 1.6% and 2.2%.
Tech giants listed in Hong Kong slumped 2% and the Hang Seng Index dropped 1.91%, or 318.19 points, to 16,327.86. The Hang Seng China Enterprises Index declined 1.64%.
US Dollar Dives
Elsewhere across the region, Indian stocks advanced with Mumbai’s signature Nifty 50 index up 0.82%, or 170.30 points, at 20,857.10. MSCI’s broadest index of Asia-Pacific shares outside Japan was down 1% in late afternoon trade.
In currency markets, the dollar, which suffered its sharpest monthly decline for a year in November, rose slightly overnight. Core inflation in Tokyo slowed in November, though the yen strengthened a little to 146.88 per dollar.
The Australian and New Zealand dollars retreated from multi-month highs on Monday. They were last a little weaker, with the Aussie dropping to $0.6583, where it was testing support at its 200-day moving average.
The Reserve Bank of Australia left interest rates on hold and said, as it had a month ago, that future rate settings would depend on data.
In oil, Brent crude futures traded broadly steady at $78.07 a barrel, having fallen overnight on doubts that producers will make further cuts to output.
Key figures
Tokyo – Nikkei 225 < DOWN 1.37% at 32,775.82 (close)
Hong Kong – Hang Seng Index < DOWN 1.91% at 16,327.86 (close)
Shanghai – Composite < DOWN 1.67% at 2,972.30 (close)
London – FTSE 100 < DOWN 0.22% at 7,496.22 (0934 GMT)
New York – Dow < DOWN 0.11% at 36,204.44 (Monday close)
- Reuters with additional editing by Sean O’Meara
Read more:
Moody’s Downgrades China’s Credit Outlook to Negative
India to Overtake China to Become Global IPO Leader
Emerging Asia Sees Largest Outflows as Funds Stay Cold on China
Hang Seng Falls on Downbeat Data, Nikkei Dips on Weak Yen
