Asia: Markets fall after treasury yield rise and China tech accusations

Asian markets fell on Friday after stocks took a tumble on Wall Street overnight and with US 10-year treasury yield at their highest point in seven years.

Japan’s Nikkei 225 dropped by 0.80% to 23,783.72 and the yen fell by 0.01% against the US dollar to JPY113.92 as the jump in US treasury yields dampened equity investor sentiment.

The country’s tech stocks struggled as its market followed Wall Street’s lead, with semiconductor testing firm Advantest, chip-maker Tokyo Electron and electronics manufacturer TDK all dropping in Friday trading.

Cosmetics firm Shiseido also fell by more than 3% as a report detailing its new plan to double sales of its premium retail brand by discontinuing its Dicila skin care brand was released.

The South Korean Kospi dipped by 0.31% to 2,267.52, dropping for a fifth consecutive session, with tech giant Samsung failing to make gains despite reporting an anticipated record operating profit for the third quarter.

Hong Kong’s Hang Seng Index fell by 0.19% to 26,572.57 after Chinese tech stocks took a hit following reports that China infiltrated US companies using hardware hacks.

Computer manufacturer Lenovo dropped by over 15% at the news, telecoms equipment maker ZTE also plummeted by double figures amid accusations that microchips made for US companies such as Amazon and Apple were used to steal technology secrets.

Chinese government agents sneaked spy chips into Super Micro servers used by Amazon, Apple, the US government, and about 30 other organisations, according to a Bloomberg report.

Analysts at CGS-CIMB Securities in Hong Kong said: "Electronics produced in China may be viewed unsafe due to this news and tech shares are falling in general because of that."

China’s mainland market continued their week-long holiday but will be back to face the flames next week.

Oil prices remained elevated, with WTI up 0.40% to $74.63 and Brent Crude fairly flat to $84.65.

Bucking the trend was the Australian S&P/ASX 200, which was up by 0.15% at 6,185.48 despite the negative overnight cues from Wall Street.

Gains in US financial stocks sent three of Australia’s major banks higher, with the Commonwealth Bank, ANZ Banking and Westpac all higher at the Friday close, while gold miners Evolution Mining and Newcrest also on the rise despite a dip in gold prices.

New Zealand’s S&P/NZX50 fell by 0.46% to 9,214.87 as rising US bond yields warded investors off stocks.

Rate sensitive stocks fell across the board, with Genesis Energy, Investore Property, Property For Industry and Mercury NZ all negative by the close of trading.

The country’s low exposure to tech stocks spared it from further damage, though mobile payments firm Pushpay Holdings and customer engagement software developer Gentrack Group were also lower.

New Zealand’s dollar was down 0.25% against the greenback at NZ$1.55, while the Australian dollar was down 0.10% at AU$1.41.