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23 Mar 2021 | 10:48

Asia report: Tech leads region lower, Baidu flops on debut

(Sharecast News) - Most markets in Asia finished in negative territory on Tuesday, as technology plays declined across the region despite a solid session for the counterparts on Wall Street overnight. In Japan, the Nikkei 225 was down 0.61% at 28,995.92, as the yen strengthened 0.36% against the dollar to last trade at JPY 108.46.

Of the major components on the benchmark index, robotics specialist Fanuc was down 1.58%, Uniqlo owner Fast Retailing was off 0.1%, and technology giant SoftBank Group was 0.9% weaker.

The broader Topix index was off 0.94% by the end of Tokyo's trading day, closing at 1,971.48.

On the mainland, the Shanghai Composite lost 0.93% to 3,411.51, and the smaller, technology-centric Shenzhen Composite was 1.13% weaker at 2,197.71.

South Korea's Kospi slid 1.01% to 3,004.74, while the Hang Seng Index in Hong Kong dropped 1.34% to 28,497.38.

Chinese search giant Baidu floundered on its debut in Hong Kong on Tuesday, with its shares closing unchanged, after opening 0.8% higher than their offer price of HKD 252.

Among the technology plays in the special administrative region, Meituan was down 5.24% and Tencent slipped 0.79%.

The blue-chip tech names were weaker in Seoul as well, with Samsung Electronics down 0.24% and SK Hynix sliding 2.17%.

Losses for technology stocks in Asia came after a rally for the sector stateside overnight, where the Nasdaq Composite was 1.23% firmer as bond yields fell.

"When US rates are on the move, markets get bumpy across the globe," said Axi chief global market strategist Stephen Innes, adding that Asia had not been spared the wrath of higher US rates.

"Indeed, risk assets have taken a hit and exchange rates have become more volatile.

"At the same time, all this focus on where US yields might be headed is distorting the field of view."

What posed the most significant risk to the region in the coming year was not tiger US dollar funding costs, Innes said.

"Instead, it's the likely protracted recovery in local demand.

"Here, higher US rates don't help, of course, but they aren't the main issue."

Oil prices were lower as the region went to bed, with Brent crude last down 3.53% at $62.34, and West Texas Intermediate falling 3.62% to $59.33.

In Australia, the S&P/ASX 200 was off 0.11% at 6,745.40, while across the Tasman Sea, New Zealand's S&P/NZX 50 went against the regional trend, rising 0.53% to 12,394.34.

Both of the down under dollars were weaker against the greenback, with the Aussie last off 1.14% at AUD 1.3057, and the Kiwi retreating 1.93% to NZD 1.4232.

Stephen Innes said the New Zealand dollar was the standout underperformer of the day, noting that 'macro-prudential' measures had been tried elsewhere, such as in Hong Kong and Singapore.

"Although New Zealand is a pioneer in G10 in this regard, it doesn't necessarily follow that if the government succeeds in slowing house price inflation, NZD weakness should result," he said.

"More housing supply increases the prospect of stronger economic growth via the investment channel."
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