Asian markets faced turbulent trading Wednesday as technology stocks retreated despite record U.S. gains. The Hang Seng Index dropped 0.14% to 22,944.24, with Chinese tech stocks leading declines after brief rallies earlier this week.
Key developments driving market anxiety:
- Baidu fell 2.05% after reporting 4th-quarter revenue decline
- Trump threatens 25% tariffs on auto/tech imports
- Yen weakens to 151.76 against USD amid trade uncertainty
Alibaba shares slid 1.74% in Hong Kong while Tencent lost 1.13%, reflecting investor skepticism about China's AI sector growth. Stephen Innes of SPI Asset Management noted:
Hong Kong’s sell-off deflated Asia’s risk-on rally – automakers now face double pressure from tariffs and slowing EV demand.
Japan’s Nikkei 225 slipped 0.27% as Toyota and Honda shares dipped. Analysts warn new U.S. tariffs could reduce Japanese auto exports by $18B annually. Meanwhile, South Korea’s KOSPI bucked trends with a 1.7% surge as semiconductor stocks gained.
While S&P 500 reached record highs, European markets opened cautiously with France’s CAC 40 down 0.20%. Energy markets showed resilience with Brent crude rising to $76.44/barrel despite economic headwinds.
Francesco Pesole at ING Economics warned:
Trump’s transactional NATO approach risks prolonged euro weakness below $1.04.Currency traders shifted focus to USD/JPY levels not seen since 1990.
