ASIA MARKETS: Japan's Nikkei Slides The Most In 8 Months As Tech Selloff Continues Across Asia

By Kenan MachadoFeaturesDow Jones Newswires

Nikkei down as yen gains; Australia's top mining companies slump

Asia-Pacific stocks continued their descent Wednesday after the S&P 500's first three-day losing streak since August, with shares of technology and commodity-linked companies leading declines

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Tech stocks were key to Tuesday's weakness in Asia and the up-to-3% overnight slide in metals prices added to pressure on Wednesday.

Japan's Nikkei ended the session 2% lower, suffering its biggest one-day percentage slide since March 22, on weakness in commodity and tech stocks and yen gains. The U.S. dollar slid to Yen112.16 from Yen112.60 in late New York trade on Tuesday.

Stocks also lagged in China, where the Shanghai Composite fell 0.3%.

Australia's S&P/ASX 200 closed 0.4% lower, led lower by declines for big miners Rio Tinto (RIO) (RIO) , down 2.5%, and BHP Billiton (BHP.AU) (BLT.LN) , down 2%.

Broadly speaking, "we are starting to see a little bit of diversification outside of the highly concentrated names" as the year draws to an end, said Paul Kitney, chief equity strategist for Asia Pacific at Daiwa Capital Markets.

He said the recent pullback in some hot areas, notably tech, was healthy and it isn't a sign that things have changed fundamentally. "The mind-set now is so used to low volatility that a healthy correction of 2% to 3% is making people talk about it."

But the tech sector isn't out of the woods. In Tokyo, Apple vendor Alps Electric (6770.TO) fell 3.2%. Meanwhile, the tech-heavy Taiex index in Taiwan dropped 1.6% to a more-than two-month low and Korea's Kospi slumped 1.4%.

Tech companies were also lower in Hong Kong, with AAC Technologies Holdings (2018.HK) and Sunny Optical Technology Group (2382.HK) skidding 7.3% and 12.5%, respectively.

Tencent Holdings (0700.HK) ended a volatile day down 2.7%, adding to a substantial pullback over the past two weeks, while Geely Automobile Holdings (0175.HK) slid 8.4%. The Hang Seng ended the day 2.1% lower.

Following tech-driven stock gains this year, investors have become skittish about tax implications from U.S. legislation, said Douglas Morton, head of research for Asia at Northern Trust Capital Markets. But "little has changed fundamentally in our opinion."

Still, there has been caution this week as Republicans continue work on the tax policy.

(END) Dow Jones Newswires

December 06, 2017 04:38 ET (09:38 GMT)