Asian Stocks Down, Positive Chinese Data Fails to Stop Global Tech Selloff

  • Stock Market News
Asian Stocks Down, Positive Chinese Data Fails to Stop Global Tech Selloff
Credit: © Reuters.

By Gina Lee – Asia Pacific stocks were down on Thursday morning, despite better-than-expected Chinese data. A global selloff in technology shares spilled into the region following the U.S.’s losses overnight, with South Korean internet services provider Kakao Corp . (KS: 035720 ) tumbling as much as 10% and Australian payment services firm Afterpay  (ASX: APT ) dropped a maximum of 11%.

China’s Shanghai Composite was down 0.69% by 9:42 PM ET (2:42 AM GMT) and the Shenzhen Component fell 1.18%. Data released earlier in the day showed that the Caixin services purchasing managers index (PMI) was 53.1 in December.

Investors also continue to digest Tencent Holdings (OTC: TCEHY ) Ltd.'s (HK: 0700 ) divestment of a stake in Sea Ltd (NYSE: SE ) on Wednesday, with worries that other firms will follow the move. The Nasdaq Golden Dragon China Index, which tracks Chinese firms listed in the U.S., retreated for a fourth consecutive day.

Hong Kong’s Hang Seng Index fell 0.70%, with the city tightening its restrictive measures on Wednesday.

Japan’s Nikkei 225 tumbled 2.20%, with December’s services PMI at 52.1. South Korea’s KOSPI was down 0.32%, with the Korean won falling to its lowest since July 2020.

in Australia, the ASX 200 slid 1.77%.

Investors’ focus is also on central banks tightening their monetary policies thanks to persisting concerns about the omicron COVID-19 variant’s threat to global economic recovery and company earnings. The U.S. Federal Reserve released the minutes from its December meeting on Wednesday, which said that a strengthening economy and higher inflation could lead to earlier and faster interest rate hikes than expected.

“We are prepping people for volatility,” BMO Family Office deputy chief investment officer Carol Schleif told Bloomberg.

“You had another record double-digit year and yet investors’ mood is pretty dour. We definitely think the readjustment of the volatility will increase this year because there is a lot to be dealt with. You do have a leveling off of some things, improvement in some things, and people are going to be watching both the Fed and company earnings.”

Meanwhile, St. Louis Fed President James Bullard will speak at an event later in the day with San Francisco Fed President Mary Daly speaking on a separate panel a day later.

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