Most Asian stocks declined on Thursday as investors moved out of major technology names amid rising concerns about high valuations. Attention also shifted to a series of key earnings reports coming from Hong Kong.
Regional markets took mixed signals from Wall Street. A rotation out of tech dragged the Nasdaq lower, even as the Dow Jones climbed to a record high.
S&P 500 futures edged up in Asian hours after U.S. lawmakers passed legislation to end the longest government shutdown in U.S. history.
Tech-heavy indexes fall under sector rotation
Tech-focused markets such as South Korea’s KOSPI and Hong Kong’s Hang Seng slipped on Thursday as money moved out of the tech sector and into more economically sensitive areas.
Japan’s Nikkei 225 traded largely flat, while the broader TOPIX—less dependent on tech—rose 0.6%.
Japanese producer inflation came in slightly above expectations for October, keeping investors cautious about the Bank of Japan’s policy outlook.
The broader shift away from tech was driven by worries about stretched valuations, particularly following months of enthusiasm around artificial intelligence.
Mainland Chinese indexes, which have lower tech exposure, advanced. The Shanghai Shenzhen CSI 300 gained 0.7%, while the Shanghai Composite added 0.3%.
Hong Kong slips ahead of major tech earnings
Hong Kong’s Hang Seng index fell 0.4%, weighed down by losses in technology stocks.
Investors focused on upcoming earnings from several of China’s biggest internet and tech companies. Results from Alibaba Group (HK:9988), Tencent Holdings (HK:0700), and JD.com (HK:9618) are due Thursday, while Semiconductor Manufacturing International Corp (HK:0981) reports Friday.
These results will offer key insights into China’s AI roadmap. Reports from JD.com and Alibaba will also provide a clearer view of consumer spending trends, given their major roles in e-commerce.
Australia’s ASX 200 drops as strong jobs data cut rate expectations
Australia’s ASX 200 was the worst-performing major index in Asia, falling 1.1%. Stronger-than-expected jobs data sharply reduced expectations for further interest rate cuts by the Reserve Bank of Australia.
Government data showed employment growth more than doubled expectations in October, while unemployment fell more than forecast.
The numbers raised concerns that a strong labor market and sticky inflation will limit the RBA’s willingness to cut rates further.
The RBA has repeatedly stated that inflation and employment are the key factors influencing rate decisions. With both remaining firm, market expectations for cuts have weakened.
ANZ analysts said they expect the RBA to hold rates steady in December, with one final cut likely in early 2026.
Elsewhere in Asia, Singapore’s Straits Times index dipped slightly. Futures for India’s Nifty 50 rose 0.1%, bringing the benchmark close to reclaiming the 26,000 level.
India’s consumer inflation for October came in far below expectations, increasing the likelihood of more rate cuts by the Reserve Bank of India.
