Asian Stocks Retreat as Technology Shares Drop, Hong Kong Slides

  • Japan’s Topix retreats from highest close since January
  • Markets await U.S. jobs data, Italy’s weekend referendum

Abacus Asia's Poh: Stocks Have Rallied Too Much

Asian stocks declined as technology companies tumbled and a slump in casino operators dragged down a gauge of Hong Kong shares by the most in almost three weeks.

The MSCI Asia Pacific Index lost 0.4 percent to 135.71 as of 4:10 p.m. in Hong Kong, erasing a weekly gain. Japan’s Topix index slid from a January high, while Galaxy Entertainment Group Ltd. and Sands China Ltd. sank in Hong Kong after a cash disclosure rule report in Macau. Developed-market stocks headed for their first weekly drop since Donald Trump’s election spurred bets on increased fiscal stimulus and a subsequent bounce in U.S. growth.

“Markets have rallied pretty strongly and we had three fantastic weeks but buying pressure certainly looks exhausted,” James Woods, global investment analyst at Rivkin Securities in Sydney said by phone. “We will see some corrective declines and profit taking, and from a technical perspective, allowing momentum indicators to unwind before gains can be sustained.”

Asian equities have fluctuated this week as OPEC’s pact to reduce crude output removed the market’s uncertainty over oil, while investors parse through economic data for clues on the prospects for higher U.S. interest rates. Markets will look at Friday’s non-farm payrolls data in the U.S., the last jobs report before the Federal Reserve meets this month. Focus also switches to Italy’s vote outcome on constitutional reform at the weekend.

Japanese shares are pausing after rallying in November as the yen plunged more than 8 percent. The nation’s benchmark Topix index extended gains to its highest level since January on Thursday, after capping its best monthly performance since July. The Nikkei 225 Stock Average pulled back on Friday from the highest level this year, though it’s still down more than 3 percent for 2016.

Apple suppliers in Japan declined after a report that the U.S. company is reducing orders for iPhone 7 parts. Murata Manufacturing Co. retreated 3.3 percent, while Alps Electric Co. fell 3.7 percent. In Taipei, Taiwan Semiconductor Manufacturing Co. sank 2.7 percent, the largest drag on the MSCI Asian stocks gauge, while Pegatron Corp. lost 1.7 percent.

Taiwan’s Taiex index fell 0.8 percent, paring a third weekly advance. South Korea’s Kospi index lost 0.7 percent. Data showed the economy expanded 2.6 percent from a year in the third quarter, according to revised government data, from 2.7 percent increase earlier. Australia’s S&P/ASX 200 Index was 1 percent lower while New Zealand’s S&P/NZX 50 Index declined 0.4 percent.

The Hang Seng Index sank 1.4 percent to erase a weekly advance. Galaxy Entertainment and Sands China sank at least 4.1 percent, the biggest decliners in the Hong Kong gauge. Macau may require inbound travelers to disclose cash holdings of over 120,000 patacas ($15,000) at entry, Teledifusão de Macau reported. 

The Hang Seng China Enterprises Index of mainland Chinese companies listed in Hong Kong lost 1.1 percent and the Shanghai Composite Index fell 0.9 percent. India’s S&P BSE Sensex index fell 0.4 percent. Indonesian equities climbed 0.8 percent, set for their best week since August, as protests in the capital by more than 100,000 people against Jakarta’s Christian governor turned out to be peaceful.

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