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Asian markets close lower as tech shares mirror US declines

  • Asian shares mostly finished lower on Thursday
  • Tech shares in the region slid, mirroring the move on Wall Street
  • Australian financials slipped after banking chiefs called for an inquiry into the sector
  • China official manufacturing PMI topped expectations
  • The Korean won tumbled after South Korea's central bank raised interest rates for the first time in six years

Most Asian markets closed lower on Thursday as oil prices firmed after falling in the last session. Meanwhile, technology stocks in the region declined after U.S. shares in the sector sold off on Wednesday. Investors in the region also digested the better-than-expected official manufacturing PMI data out of China.

Markets on the move

Japan's Nikkei 225 rose 0.57 percent, or 127.76 points, to close at 22,724.96 as losses in major tech names were offset by gains in financial stocks. Sony closed down 2.27 percent and Nintendo ended 2.23 percent lower. Financials and trading houses rose, with Nomura Holdings climbing 3.03 percent by the end of the day.

In South Korea, the benchmark Kospi index fell 1.45 percent to end at 2,476.37 as tech stocks took a tumble. Markets also digested the Bank of Korea's decision to raise interest rates for the first time in six years. The central bank increased rates to 1.5 percent from 1.25 percent in a move that had been widely expected by markets.

The Korean won tumbled following the rate hike. At 3:03 p.m. HK/SIN, the currency traded almost 0.5 percent lower on the day at 1,086.29 won to the dollar. "[The] Bank of Korea hike is a buy the rumor, sell the fact event for the won," Philip Wee, FX strategist at DBS, said in a note.

Samsung Electronics and SK Hynix, the two-largest names on the Kospi, closed down 3.42 percent and 6.8 percent, respectively, with tech the worst-performing sector on the day.

Down Under, the S&P/ASX 200 lost 0.69 percent to end at 5,969.89, with losses in materials, technology and banking stocks dragging the index lower.

Australian financial stocks ended lower after the government said it would launch an inquiry into the sector. Top executives from the country's so-called "Big Four" had earlier sent a joint letter to Treasurer Scott Morrison calling for "a properly constituted inquiry" into sector in a bid to "restore trust." Commonwealth Bank closed down 1.91 percent and ANZ fell 1.08 percent.

Mainland China markets also came under pressure, with the Shanghai Composite edging down 0.61 percent to finish at 3,317.58 and the Shenzhen Composite losing 0.9 percent to close at 1,901.86.

China's official manufacturing Purchasing Managers' Index came in at 51.8 for November, above the 51.4 forecast by economists in a Reuters survey. The services sector PMI reading came it at 54.8, compared to the 54.3 seen last month.

Tech was also among the worst-performing sectors on the Hang Seng Index, which fell 1.26 percent by 3:12 p.m. HK/SIN, following the slide in U.S. tech stocks. The sector was down 3 percent in afternoon trade, with Tencent lower by 2.19 percent at 3:14 p.m. HK/SIN. Property and casino stocks also declined.

Philippine markets were closed for Bonifacio Day. Markets in Kuwait, Bahrain and the United Arab Emirates were also closed.

Symbol
Name
Price
 
Change
%Change
NIKKEI
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HSI
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ASX 200
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SHANGHAI
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KOSPI
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CNBC 100
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Currency watch

The New Zealand dollar was in focus after the currency fell more than 0.5 percent after an ANZ survey showed business confidence in the country had fallen to its lowest levels since 2009. The Kiwi dollar traded at $0.6845 at 3:04 p.m. HK/SIN, compared to Wednesday's close of $0.6878.

The pound hit a two-month high as negotiations between the U.K. and the European Union made progress. Sterling traded at $1.3455 after rising as high as $1.3479 earlier in the session.

Meanwhile, the dollar softened slightly against a basket of currencies. The dollar index stood at 93.150 at 3:05 p.m. HK/SIN, a touch below Wednesday's close of 93.257. The greenback extended overnight gains made against the yen to trade at 112.18.

The lead up

Tech stocks sold off stateside on Wednesday as financials rose. The Dow Jones industrial average closed at a record high as investors focused on momentum in the U.S. economy. The second estimate for third-quarter GDP was revised to 3.3 percent from 3 percent. It was also above the 3.2 percent expected by markets.

The Dow rose 103.97 points, or 0.44 percent, to close at 23,940.68. The Nasdaq composite underperformed other major U.S. indexes, falling 1.27 percent as popular tech names recorded significant declines.

Yields on U.S. Treasurys moved higher as investors took note of better-than-expected GDP numbers and outgoing Federal Reserve Chair Janet Yellen's remarks on the outlook for the U.S. economy. Yellen also said on Wednesday that she was "very worried" about the U.S. public debt trajectory.

In other news, bitcoin traded around $10,225 at 3:25 p.m. HK/SIN after volatile trade over the last 24 hours. The cryptocurrency had cracked the $11,000 mark before falling more than 18 percent.

The commodities trade

U.S. West Texas Intermediate tacked on 0.37 percent to trade at $57.51 per barrel after settling 1.2 percent lower in the last session. Brent crude advanced 0.52 percent to trade at $63.44.

Oil prices had been volatile in the lead-up to a highly-anticipated meeting among major oil producers on Thursday. Markets expect an agreement between oil producers to be extended, but some are concerned about Russia's commitment to extend those cuts. The existing output agreement, which includes OPEC and Russia, will expire in March next year.

Corporate news

Japan's Oriental Land, which operates Tokyo Disney Resort, intends to grow the theme park to attract tourists, according to Nikkei. The company reportedly has plans to spend 300 billion yen ($2.68 billion) on the expansion. Shares of the company closed up 3.58 percent following the news.

— CNBC's Yen Nee Lee contributed to this report.