HONG KONG — Asian shares tumbled on Friday, with Japan’s Nikkei down 2.4% on heavy selling of semiconductor-related stocks and other market heavyweights.
Tensions in the Middle East weighed on sentiment across the region, and US futures were sharply lower.
Oil prices rose as state news agency IRNA reported that Iran had fired air defense batteries early Friday morning after reports of explosions near the city of Isfahan.
Japan’s benchmark Nikkei 225 lost 2.4% to 37,156.54, paring losses in early trading when it fell 3.5%.
Semiconductor equipment supplier Lasertec was the biggest loser, losing 8.4%. But most other major technology-related stocks also fell. Renesas lost 6%, Tokyo Electron lost 8.7% and Sony Group Corp. fell 1.8%.
Toyota Motor Corp fell 2.2%.
Japan’s headline inflation fell to 2.7% in March, the government reported, while the core index, which excludes fresh food and energy costs, fell to 2.9%, the first time since November 2022 was that it fell below 3%.
The yen was slightly firmer against the US dollar, with the latter falling from 154.64 yen to 154.38 Japanese yen.
Markets are awaiting the Japanese central bank’s next move after last month raising its key interest rate for the first time in 17 years, ending a long-standing policy of negative rates aimed at stimulating the economy . But the rate remains close to zero.
Elsewhere, the Australian S&The P/ASX 200 fell 1.1% to 7,561.60. South Korea’s Kospi fell 1.7% to 2,589.65. Hong Kong’s Hang Seng fell 1.4% to 16,149.44, while the Shanghai Composite fell 0.5% to 3,059.30. Taiwan’s Taiex fell 3.8%, while shares of Taiwan Semiconductor Manufacturing Co tumbled 6.7%.
Overnight stay on Wall Street, the S&The P500 fell 0.2% to 5,011.12 after swinging between small gains and losses during the day. The decline was small, but still enough to give the index a fifth loss in a row. That is the longest losing streak since October, and is 4.6% below the record at the end of last month.
The Dow Jones Industrial Average rose 0.1% to 37,775.38, and the Nasdaq index fell 0.5% to 15,601.50.
Equifax fell 8.5%, one of the market’s biggest losses, after reporting weaker revenue for the latest quarter than analysts expected. High interest rates are putting pressure on mortgage research activities.
The only stock that fell more in the S&The P 500 was Las Vegas Sands, which fell 8.7% even as it reported better results than expected. Analysts said investors may be concerned about the competition the casino and resort company faces in Macau, an enclave in southern China that is one of the world’s largest gambling havens.
Helping offset those losses was Elevance Health, which rose 3.2% after raising its full-year profit forecast. Original parts rose 11.2%, making it the biggest gainer in the S&P500 after the automotive and industrial replacement parts distributor reported stronger profits than analysts expected. It also increased its range for full-year expected earnings.
Stocks have been struggling lately as bond market yields rise. They are increasing the pressure as investors have largely given up hope that the Federal Reserve will make many interest rate cuts this year.
Yields edged higher after more reports on Thursday showed the U.S. economy remains stronger than expected.
According to one report, fewer workers filed for unemployment benefits last week than economists expected. It’s the latest sign that the labor market remains solid despite high interest rates.
Another report said Thursday that manufacturing growth in the Mid-Atlantic region accelerated sharply, while economists expected a contraction.
A third report said sales of previously occupied U.S. homes did not fall as much last month as economists expected.
Similar data, along with a series of reports showing that inflation has remained higher than forecast this year, recently prompted top Fed officials to say they may keep rates high for a while.
That is a letdown after the Fed previously indicated that three interest rate cuts would be possible this year. But Fed officials are adamant they want to make sure inflation heads toward the 2% target before cutting the Fed’s key interest rate from the highest level since 2001.
In oil trading, U.S. crude rose $1.16 to $83.89 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, rose $1.21 to $88.32 a barrel.
The euro fell from $1.0644 to $1.0635.
