Hong Kong leads losses in Asia as tech stocks drag down most markets

SINGAPORE — Most Asia-Pacific markets fell on Tuesday after heavy losses overnight on Wall Street that saw the tech-heavy Nasdaq Composite dropping more than 4%.

Returning to trade after a holiday on Monday, Hong Kong’s Hang Seng index closed 1.84% lower on Tuesday at 19,633.69.

Hong Kong-listed shares of Chinese tech firms dropped, with Tencent declining 2.29% while Alibaba shed 4.81% and NetEase fell 1.91%. The Hang Seng Tech index slipped 3.22% to 3,906.43.

Technology shares elsewhere in Asia-Pacific also declined in Tuesday trade, largely mirroring losses after the Nasdaq Composite dropped 4.29% overnight to 11,623.25.

Shares of Japanese conglomerate SoftBank Group fell 1.78%. South Korea’s Kakao lost 0.59% while Krafton dropped 2.58%.

“I think the broader picture is going to remain one of higher bond yields and tighter monetary policy which ultimately will work against tech stocks,” Shane Oliver, head of investment strategy and chief economist at AMP Capital, told CNBC’s “Street Signs Asia” on Tuesday.

“Beyond any short-term bounce from oversold, I’m not overly confident [on the tech sector],” Oliver said. “I’d tend to favor cyclicals, resources stocks, industrials.”

In the broader markets, the Nikkei 225 in Japan fell 0.58% to close at 26,167.10 while the Topix index slipped 0.85% to 1,862.38.

South Korea’s Kospi dropped 0.55% on the day to 2,596.56 while the S&P/ASX 200 in Australia fell 0.98%, closing at 7,051.20.

Mainland Chinese stocks bucked the broader trend, and outperformed the broader region. The Shanghai Composite recovered from earlier losses to close 1.06% higher at 3,035.84 while the Shenzhen Component climbed 1.367% to 10,912.74.

MSCI’s broadest index of Asia-Pacific shares outside Japan declined 0.82% lower.

Other major indexes on Wall Street also saw substantial losses overnight, with the S&P 500 slipping 3.2% to 3,991.24 — falling below the 4,000 level for the first time in more than a year. The Dow Jones Industrial Average shed 653.67 points, or 1.99%, to 32,245.70.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 103.707 — still off levels above 103.8 seen recently.

The Japanese yen traded at 130.2 per dollar, stronger than levels above 130.5 seen against the greenback yesterday. The Australian dollar was at $0.6963, struggling to recover after last week’s drop from above $0.72.

Oil prices were higher in the afternoon of Asia trading hours, with international benchmark Brent crude futures climbing 1.45% to $104.40 per barrel. U.S. crude futures gained 1.44% to $101.6 per barrel.