Asian stocks mixed after big tech sell-off

HONG KONG: Asian stocks were mixed on Wednesday following a sell-off in big technology stocks from Asia to Wall Street.

US stock futures were also trading mixed, as global investors monitor market movements in Japan and South Korea, which have seen big gains in recent months on the global AI boom but both fell sharply on Tuesday.

South Korea's benchmark Kospi index was up 0.5 per cent to 8,241.23, recovering slightly from its 10 per cent decline on Tuesday. Shares of memory chip maker SK Hynix, one of the country's most valuable stocks, fell 3.6 per cent. Samsung Electronics was up 3.7 per cent after Tuesday's 12.3 per cent plummet.

Tokyo's Nikkei 225 lost 1.1 per cent to 68,991.77 after falling 3.6 per cent on Tuesday.

Taiwan's Taiex, which is also heavily influenced by tech shares, fell 2.5 per cent.

Hong Kong's Hang Seng edged up 0.1 per cent to 23,364.72. The Shanghai Composite index was down 0.3 per cent to 4,096.14. Australia's S&P/ASX 200 was trading 0.1 per cent higher at 8,797.00.

The declines in Asian markets, including Japan's, followed Tuesday's 1.4 per cent drop for Wall Street's benchmark S&P 500 index. The technology-heavy Nasdaq composite fell 2.2 per cent, while the Dow Jones Industrial Average ended 0.1 per cent lower.

Big tech and semiconductor stocks fell in the US. On Tuesday, Micron Technology sank 13.2 per cent, while Nvidia lost more than 4.1 per cent.

The big falls in tech shares were an “illustration of rising volatility” in these stocks, said James Reilly, senior markets economist at Capital Economics. “This is particularly true in Korea where domestic retail buyers are taking on an increasing role,” he said.

Oil prices fell early Wednesday, as more ships crossed the Strait of Hormuz while US-Iran talks on a permanent end to the Iran war made progress.

“Price movements suggest the market expects a fairly rapid recovery in Persian Gulf oil supplies,” ING commodities strategists Warren Patterson and Ewa Manthey said in a commentary.

Still, while vessel crossings in the strait increased in recent days, they remained well below pre-war levels, they noted.

Brent crude, the international standard, fell 0.7 per cent to USD 76.30 a barrel. It has been trading below USD 80 in recent days but is still elevated compared to the approximately USD 70 per barrel in late February before the war began.

Benchmark US crude was down 0.7 per cent to USD 72.70 a barrel.

In the US, investors are awaiting a report due Thursday of May's personal consumption expenditures price index or PCE, which is the preferred inflation gauge by the Federal Reserve.

Some economists predict the Fed may hold key interest rate this year but is unlikely to raise rates. Bond yields have remained higher, as inflation concerns grew amid global energy shocks.

In other dealings, the US dollar was unchanged at 161.55 Japanese yen. The euro was trading at USD 1.1364, down from USD 1.1382.