Global Stock Markets Hurt by Tech Stock Weakness

By Ese Erheriene and Kevin Kingsbury Features Dow Jones Newswires

Asian stock markets began Thursday on a downbeat note, weighed by stocks of semiconductor manufacturers after that sector was hit by fresh selling in the U.S. overnight.

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The tech-heavy Taiwan stock market saw an early 1% drop with Taiwan Semiconductor, by far the island's biggest company, sliding almost 3%. Korea's Kospi was recently down 0.6% as its market giant, Samsung Electronics, dropped 2%.

Both stocks have fallen nearly 7% this week, erasing some of their hefty gains in 2017, after Morgan Stanley dropped its bullish rating on both firms amid broader concerns of the state of the industry, particularly the memory chips segment. The investment bank said prices of those products have started to fall.

In the U.S., the Philadelphia Semiconductor Index slumped 4.4%, its biggest drop of the year. That helped push the Nasdaq Composite down 1.3%.

The weakness also persisted in Japan, with Tokyo Electron down 2.4% to put the week's slump at 12%. But with a further pullback in the yen overnight--the dollar is at Yen112--the Nikkei edged into positive territory after opening nearly 0.5% lower.

Meanwhile, the launch of a judicial inquiry into Australia's financial industry sent shares of the country's big banks sliding early before they partially recovering by midday. That allowed the S&P/ASX 200 to cut its loss to 0.5% from 1% earlier.

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The probe "will be costly, take a lot of time and lead to unknown outcomes given the broad scope," noted Omkar Joshi, portfolio manager at Regal Funds Management.

The banks' weakness also weighed on New Zealand, where some of the Australian majors are also listed. Combined with fresh uncertainty about the new government there, the NZX-50 was recently down 0.2% and on pace for its first monthly drop for 2017.

This amid news that included Chinese manufacturing data, which came in stronger than expected, an as-expected start to the rate-increase cycle in South Korea, and the meeting of the Organization of the Petroleum Exporting Countries later on Thursday. Oil prices edged lower in Asian trading after fresh overnight selling.

Meanwhile, bitcoin continued its volatile trading. It moved back above $10,000 in Asian trading Thursday after first breaking that threshold 24 hours earlier en route to briefly topping $11,000. It promptly fell more than 10%.

Robb Stewart

contributed to this article.

Write to Ese Erheriene at ese.erheriene@wsj.com and Kevin Kingsbury at kevin.kingsbury@wsj.com

(END) Dow Jones Newswires

November 29, 2017 21:08 ET (02:08 GMT)