Asian Stocks Slide as Technology Names Track U.S. Peers LowerBy
Tech shares drop most among sectors to trim year’s rally
Samsung down amid speculation on growth: Samsung Securities
Asian shares retreated from a 10-year high as technology firms led declines following earnings from U.S. heavyweights including Amazon.com Inc. and Twitter Inc.
The MSCI Asia Pacific Index dropped 0.7 percent to 159.25 as of 5:19 p.m. in Hong Kong, erasing its weekly gain. The MSCI Asia Pacific Information Technology Index fell 1.5 percent as the worst performing sub-gauge. The Asian technology benchmark is still up 37 percent this year, even with Friday’s selloff.
Twitter plunged 14 percent after it failed to lure more monthly users in the second quarter. Amazon.com shares declined in after-hours trading following its forecast for a potential quarterly loss for the first time in two years.
"After Amazon’s weaker-than-expected earnings, some investors are rotating from technology to energy and other sectors," said Mark Matthews, Singapore-based managing director and head of Asia research at Bank Julius Baer. "It’s a small correction for technology shares. They’ll probably bounce back because it’s not 2001 and they are not wildly overvalued."
Samsung Electronics Co. was the biggest drag on Asia’s regional benchmark, as investors took profits on expectations that the company’s earnings growth momentum will not be strong, You Seung Min, chief strategist at Samsung Securities, said in a phone interview.
Amazon and Twitter dragged on U.S. tech stocks overnight and “the unfavorable sentiment has spread over to Asian markets,” said Margaret Yang, a Singapore-based strategist at CMC Markets. “With the current equities valuation in the U.S., investors would need really, really good earnings to justify the multiples,” Yang said.
- Topix Index -0.4%, Nikkei 225 -0.6%
- Hang Seng Index -0.6%, HSCEI -0.9%, Shanghai Composite Index +0.1%
- Taiwan Stock Exchange Weighted Index -0.8%
- Hong Kong Shares Drop Most in Three Weeks Amid Asia Declines
- Kospi -1.7%, most since November, Kospi 200 -2%
- S&P BSE Sensex -0.5%, Nifty 50 -0.5%
- Straits Times Index -0.7%, FTSE Bursa Malaysia KLCI -0.2%, Jakarta Composite +0.2%, Thailand’s SET -0.1%, Philippines PSEi Index +0.3%, Vietnam VN-Index +0.7%
— With assistance by Harry Suhartono, and Heejin Kim