Tokyo/Hong Kong – Asian markets edged lower on Monday after a tech-driven selloff on Wall Street, though Hong Kong bucked the trend as Alibaba shares soared following strong earnings.
The MSCI Asia Pacific Index dipped 0.2%, with Japan’s Nikkei 225 sliding 2% as chipmakers came under pressure. Samsung Electronics and SK Hynix dropped after the US revoked waivers allowing them to use American technology in China. By contrast, Alibaba jumped nearly 19%, fueling optimism in China’s AI sector.
Market Highlights
- Japan: Topix fell 0.8%
- Australia: S&P/ASX 200 down 0.6%
- Hong Kong: Hang Seng up 2.1%
- China: Shanghai Composite up 0.4%
- US Futures: S&P 500 futures little changed, up 0.1%
Global Drivers
The selloff followed Nvidia’s sharp drop on Friday, which ended a rally that had lifted tech stocks since April. Still, analysts noted that Chinese technology firms are quietly accelerating growth in AI and cloud services. “A quiet re-rating for Asia tech is underway,” said Charu Chanana of Saxo Markets.
Meanwhile, US tariffs against India and China remain a key risk. A federal appeals court recently ruled that many of former President Donald Trump’s tariffs were illegal.
Commodities and Currencies
- Gold: Extended its rally, trading above $3,475 an ounce – its highest in years.
- Silver: Hit its strongest level since 2011.
- Oil: West Texas Intermediate slipped 0.3% to $63.80 per barrel amid concerns of oversupply.
- Currencies: Euro rose 0.2% to $1.1706; yen and yuan little changed.
- Crypto: Bitcoin fell 1.4% to $107,565; Ether dropped 1.7% to $4,379.
Political Risks in Asia
Indonesian markets slumped nearly 5 months’ worth of losses amid protests over inequality and rising living costs, prompting President Prabowo Subianto to cancel a trip to China. In Thailand, political uncertainty persists as parties scramble to form a new government following the disqualification of Prime Minister Paetongtarn Shinawatra.
Corporate Movers
- Alibaba: Shares surged more than 18% after reporting strong AI-driven revenue growth.
- BYD: Slumped after a 30% profit drop, its first quarterly decline in three years.
Outlook
Investors are bracing for a series of key events in the coming weeks, including US jobs data, inflation readings, and a Federal Reserve interest rate decision. September, historically Wall Street’s weakest month, is expected to test the resilience of the market rally.
Source: Bloomberg
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