Negativity on Wall Street flowed through to Asian markets on Friday, with regional stock indexes ending the day moderately lower amid declines in the technology sector.
The Nikkei 225 slipped 0.13 percent, or 28.94 points, to end at 22,162.24 as semiconductor companies declined while financials and utilities mostly rose.
Greater China markets also recorded declines, with Hong Kong’s Hang Seng Index shedding 0.67 percent by 3:00 p.m. HK/SIN.
Mainland markets saw steeper falls, with the Shanghai composite losing 1.47 percent to close at 3,071.47 and the Shenzhen composite lost 2 percent to end at 1,778.34.
Losses on Friday were broad-based, with airline, automakers and financials taking a hit.
Tech takes a hit
Semiconductor companies in the region traded lower after Taiwan Semiconductor Manufacturing (TSMC), the largest contract chipmaker in the world, said Friday it was forecasting second-quarter revenue to come in between US$7.8 billion and US$7.9 billion, below a Wall Street estimate of US$8.8 billion.
Morgan Stanley attributed TSMC’s weak guidance to order reductions from Apple iPhone processors. On Friday, TSMC shares tumbled 6.34 percent, dragging Taiwan’s Taiex lower by 1.75 percent.
In Japan, Tokyo Electron and Advantest declined 2.05 percent and 2.21 percent, respectively. Meanwhile, South Korea’s Samsung Electronic slid 2.2 percent and chipmaker SK Hynix tumbled 3.98 percent.
U.S. stocks closed moderately lower on Thursday, with the technology sector coming under pressure following TSMC’s weak guidance. Apple, for which TSMC is a supplier, fell 2.8 percent amid declines in other U.S. semiconductor stocks.
Investors also focused on higher U.S. bond yields as the yield on the 10-year U.S. Treasury note stayed above the 2.9 percent level. The two-year yield traded near its highest levels in almost a decade.
“There’s somewhat of a short attention span, with markets looking past [trade tensions], with the beige book and some of the data coming out just showing the U.S. to be relatively healthy. That might be impacting the yield curve more so than simmering trade tensions,” Alex Wolf, senior emerging markets economist at Aberdeen Standard Investments said.
In currencies, the dollar firmed as U.S. bond yields rose. The dollar index, which tracks the greenback against a basket of six currencies, stood at 89.985.
Against the yen, the dollar strengthened to trade at 107.51 at 2:41 p.m. HK/SIN.
The British pound was on the back foot after Bank of England Governor Mark Carney downplayed the possibility of a May interest rate hike. The currency traded around two-week lows at US$1.4057.
Oil prices were steady on Friday. U.S. West Texas Intermediate crude was off by 0.19 percent at US$68.16 per barrel, after touching a more than three-year high in the last session. Brent crude futures were little changed at US$73.77 per barrel.