HSI Falls As Asian Tech Stocks Feel The Heat

Hong Kong stocks suffered deep losses on Wednesday in line with a global sell-off, following another US tech rout as investors worry about high valuations after a recent rally.

The Hang Seng Index fell 1 percent, to 24,385.

The benchmark Shanghai Composite Index sank 1.1 percent to 3,280, while the Shenzhen Composite Index fell 1.8 percent, to 2,207.

Technology and energy firms were among the big losers as Asian investors ran for the exit following another rout on Wall Street, with vaccine and post-Brexit trade deal fears adding to the perfect storm.

Tokyo, Seoul, Taipei, Manila and Wellington all down more than 1 percent, while Sydney shed more than 2 percent. Singapore and Jakarta were also in negative territory.

In Tokyo, SoftBank dived more than 7 percent on worries about its exposure to tech giants after it was revealed the conglomerate had made huge derivative bets ahead of the latest sell-off. It has lost around 14 percent this week so far.

"Selling pressure is a little broader as the concerns in the tech sector are extending across broader markets and impacting risk sentiment," said JP Morgan Asset Management strategist Kerry Craig.

"The rise in safe havens, such as the US dollar, Japanese yen and gold, are further evidence of more defensive investor positioning.

"A market fuelled by central bank largesse, economic surprises and record earnings beats in the last few months was never going to maintain its heady pace forever. Market tremors are a normal, if uneasy, part of investing and not all shocks are a warning of an impending collapse in risk sentiment." (AFP)

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