(Bloomberg) — A global selloff in technology shares continued into parts of Asia Thursday, following overnight losses on Wall Street as concerns grew about more aggressive monetary tightening by the Federal Reserve.
The MSCI AC Asia Pacific Communication Services Index dropped as much as 1.5% to its lowest since June 2020. However, Hong Kong’s Hang Seng Tech Index bucked the regional trend, rising 0.3% as bargain hunting set in after three consecutive days of losses.
Among the region’s top losers, South Korea’s internet services provider Kakao Corp. fell as much as 10%, while Australia’s payment services firm Afterpay Ltd. dropped a maximum of 11%. Tokyo-based SoftBank Group Corp. shed 1.7%.
The selloff came after Fed officials said at a key meeting last month that a strengthening economy and higher inflation could lead to earlier and faster interest rate increases than expected. Asian tech firms have also been grappling with the fallout of China’s sweeping regulatory crackdown to curtail monopolistic behavior in the sector.
The selloff in growth stocks may be more prominent in the U.S. given their much higher valuations, said Jun Rong Yeap, market strategist at IG Asia Pte. “Hong Kong-listed tech firms, on the other hand, have already seen valuations beaten down so the downside risks from this aspect may seem limited.”
In addition to the slight rebound among Chinese tech firms, chipmakers in the region also demonstrated some degree of resilience. Samsung Electronics Co. and SK Hynix Inc. both edged up after losing more than 1% earlier.
(Updates stock moves and adds analyst comment)
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