Asian stocks slide as Fed fears resurface, tech hit by weak earnings
Investing.com-- Most Asian stocks fell on Friday tracking hawkish signals on U.S. interest rates, while weak earnings from industry majors including Softbank and SMIC weighed on broader technology stocks.
Regional stocks took a weak lead-in from Wall Street indexes, which sank on Thursday after Federal Reserve Chair Jerome Powell warned that interest rates could still rise, while a disappointing Treasury auction also pushed up yields. U.S. stock futures were flat in Asian trade.
Sentiment towards Asia remained weak, especially after a string of disappointing economic readings from China, which showed that the region’s biggest economy was struggling to improve spending and growth.
Tech-heavy indexes were the worst performers in Asia on Friday, with Hong Kong’s Hang Seng index leading losses with a 1.6% slide. SMIC (HK:0981)- China’s biggest chipmaker- was the worst performer on the index, losing over 4% after it clocked an 80% slump in its third-quarter profit.
Losses in SMIC- which signaled a continued weakness in global chip demand, spilled over into other chipmaking stocks. Samsung Electronics Co Ltd (KS:005930) lost over 1%, pulling South Korea’s KOSPI down by a similar margin, while TSMC (TW:2330)- the world’s biggest contract chipmaker- shed 0.4%.
Japan’s Nikkei 225 lost 0.9%, hit by steep losses in chipmaking, energy and technology stocks. Tech conglomerate SoftBank Group Corp. (TYO:9984) was among the worst performers on the index, tumbling more than 6% after it clocked an unexpected loss in the September quarter.
Softbank’s chip designing unit Arm Holdings (NASDAQ:ARM) also raised concerns over sluggish chip demand after posting disappointing earnings and a weak profit outlook earlier this week.
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