Asian shares lose ground as tech stocks tumble; central bank meetings ahead

  • Asian markets traded lower as tech stocks plunged, mirroring the fall in tech names stateside.
  • U.K. coalition talks closely watched.
  • Markets in Australia and Malaysia were closed for holidays.

Asian shares closed in negative territory on Monday, ahead of a two-day Federal Reserve meeting that begins on Wednesday, as tech stocks took a tumble.

The Nikkei 225 closed down 0.52 percent or 104.68 points, at 19,908.58 and South Korea's benchmark Kospi index fell 1 percent, or 23.82 points, to finish at 2,357.87, as the sell off in tech stocks spread from Wall Street to Asia.

Markets in greater China were lower. Hong Kong's Hang Seng Index shed 1.18 percent by 2:35 p.m. HK/SIN. The Shanghai Composite slid 0.57 percent, or 17.95 points, to end at 3,140.4504 and the Shenzhen Composite fell 1.099 percent, or 20.4032 points, to close at 1,836.7621.

Markets in Australia, Malaysia and the Philippines were closed today for public holidays.

Symbol
Name
Price
 
Change
%Change
NIKKEI
---
HSI
---
ASX 200
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SHANGHAI
---
KOSPI
---
CNBC 100
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Central banks were also in focus, with the Federal Reserve expected to release its decision on interest rates later this week. The Bank of England and Bank of Japan policy meetings later in the week were also likely to be closely watched.

Tech stocks in Japan and South Korea were under pressure after major tech names in the U.S. fell almost 3 percent in the last trading session. Taiwan Semiconductor Manufacturing, which counts Apple among its customers, was down by 2.12 percent. Samsung Electronics shed 1.56 percent.

Other companies with less obvious links to U.S. tech names also felt the heat. South Korean internet companies Naver and Kakao were down 6.77 percent and 4.37 percent respectively. In Japan, Nintendo was down 2.3 percent at 34,020 yen.

Toshiba shares bucked the trend to climb on news that Western Digital would be increasing its bid for Toshiba's memory chip unit to $18 billion or more, Reuters reported. Shares of Toshiba surged 9.41 percent on the news to close at 329.1 yen each.

The dollar dipped slightly against a basket of six major currencies after hitting a ten-day high last week. The dollar index traded at 97.156 at 2:50 p.m. HK/SIN. Dollar/yen trended lower to trade at 110.14 yen, compared with levels around the 110.4 handle seen in the last session.

The upcoming Federal Open Market Committee (FOMC) meeting starting on Wednesday U.S. time should be supportive for the dollar, said Mizuho Bank Senior Economist Vishnu Varathan in a morning note.

"With expectations consolidating around (a) Fed rate hike and further guidance on balance sheet reduction, dollar shorts could be generally cautious, which could support the dollar into the FOMC meeting this week," Varathan said. Receding political tension stateside following the testimony of former FBI Director James Comey was likely to be dollar-supportive too, he added.

Pound sterling was firmer after falling as much as 2.5 percent last week when the U.K. election resulted in no party being able to claim a majority at parliament. Cable last traded at $1.2744.

In energy news, oil prices rose slightly after finishing last week down by around 4 percent. Brent crude rose 0.25 percent to trade at $48.27 a barrel and U.S. West Texas International crude added 0.22 percent to trade at $45.93.

Japan April core machinery orders, which tend to be volatile, fell 3.1 percent on month — greater than the 1.3 percent decline projected, Reuters said.

Stateside, stocks closed mixed in the last session, with tech stocks under pressure after hitting record highs at the beginning of the session. The Nasdaq tumbled 1.8 percent, or 113.85 points, to end at 6,207.92.