Asian Stocks Decline as Investors Rotate Out of Tech Ahead of Key Hong Kong Earnings

Most Asian stock markets slipped on Thursday as investors pulled out of heavyweight technology shares amid growing concerns over high valuations and shifting focus toward major Hong Kong earnings. The move followed a mixed performance on Wall Street, where a tech sell-off dragged the Nasdaq lower while the Dow Jones hit a record high. Meanwhile, S&P 500 futures edged up in Asian trading after U.S. lawmakers ended the nation’s longest government shutdown.

Technology-heavy markets such as South Korea’s KOSPI and Hong Kong’s Hang Seng Index fell, with Japan’s Nikkei 225 trading flat. The broader TOPIX, which includes more non-tech stocks, gained 0.6%. Japan’s producer price inflation rose slightly above expectations for October, fueling speculation about potential hawkish signals from the Bank of Japan.

The recent rotation away from tech was driven by concerns over inflated valuations, largely fueled by the ongoing enthusiasm surrounding artificial intelligence. In contrast, Chinese mainland markets advanced, with the Shanghai Shenzhen CSI 300 climbing 0.7% and the Shanghai Composite adding 0.3%.

Hong Kong’s Hang Seng dropped 0.4% ahead of highly anticipated earnings from major Chinese tech firms including Alibaba Group, Tencent Holdings, and JD.com, all scheduled to report Thursday. Semiconductor Manufacturing International Corp (SMIC) will release its results on Friday. These reports are expected to offer insights into China’s AI development and consumer spending trends.

Australia’s ASX 200 was the region’s weakest performer, sliding 1.1% after stronger-than-expected employment data reduced prospects for further rate cuts by the Reserve Bank of Australia. Meanwhile, Singapore’s Straits Times edged lower, and India’s Nifty 50 futures gained 0.1% as soft October inflation data boosted rate-cut expectations by the Reserve Bank of India.