Most Asian stocks fell on Wednesday, with losses centered around Taiwan and China after Republican presidential candidate Donald Trump said Taiwan should pay the United States for defense.
However, broader losses were limited by a strong lead from Wall Street, with the Dow Jones rising about 2% to record highs, as optimism about lower interest rates prompted traders to shift to more economically sensitive sectors and out of technology.
U.S. stock index futures were slightly lower during Asian trading.
Taiwan, China shares fall after Trump comments
Taiwan’s index fell 0.3%, while China and Australia’s indices fell 0.1% and 0.5%, respectively. Hong Kong’s index lost 0.2%.
Trump said in an interview with Bloomberg Businessweek that he believes Taiwan should pay the United States for supplying the island with defense equipment, on the grounds that Taiwan gives the United States nothing.
“I know the people very well and respect them very much. They’ve taken over almost 100% of our chip business. I think Taiwan should pay us for defense,” Trump said in the interview, adding that the United States was no different than an insurance company.
Relations between Taiwan and China are a sensitive topic, as Beijing has consistently called for the reunification of Taiwan and the mainland. The United States is the island’s largest defense supplier, but it has no formal diplomatic agreement with Taipei.
Concerns about Trump’s presidency have also rattled Chinese markets in recent sessions, as the former president has maintained strong rhetoric against the country. His administration sparked a trade war with Beijing in the late 2000s.
Chinese markets also suffered losses due to a series of weak economic readings in the country.
Tech stocks fall as key earnings loom
Asian technology stocks, especially chipmakers, fell on Wednesday as expectations of interest rate cuts drove flows into more economically sensitive sectors.
Shares of major chipmakers were also nervous ahead of the sector’s key earnings this week, with ASML Holding NV (AS:) ADR (NASDAQ:) and TSMC (TW:) (NYSE:) reporting earnings on Wednesday and Thursday, respectively.
Both are an indicator of demand for chips, which has risen sharply over the past year amid growing interest in artificial intelligence.
TSMC shares fell about 2% after Trump’s comments on Taiwan.
Chipmakers suffered losses, with Japanese shares rising just 0.2%, while South Korean shares lost 0.2%.
Other Asian indices — especially those with a smaller weighting in the technology sector — rose on the prospect of a rate cut. Japan’s index rose 0.5%, while Australia’s rose 1% to a record high.
India index futures pointed to a positive open as the index and stock market continued to hit record highs amid continued optimism about the Indian economy.
Asian stocks dip on tech losses, Trump comments rattle Taiwan, China markets By Investing.com
Most Asian stocks fell on Wednesday, with losses centered around Taiwan and China after Republican presidential candidate Donald Trump said Taiwan should pay the United States for defense.
However, broader losses were limited by a strong lead from Wall Street, with the Dow Jones rising about 2% to record highs, as optimism about lower interest rates prompted traders to shift to more economically sensitive sectors and out of technology.
U.S. stock index futures were slightly lower during Asian trading.
Taiwan, China shares fall after Trump comments
Taiwan’s index fell 0.3%, while China and Australia’s indices fell 0.1% and 0.5%, respectively. Hong Kong’s index lost 0.2%.
Trump said in an interview with Bloomberg Businessweek that he believes Taiwan should pay the United States for supplying the island with defense equipment, on the grounds that Taiwan gives the United States nothing.
“I know the people very well and respect them very much. They’ve taken over almost 100% of our chip business. I think Taiwan should pay us for defense,” Trump said in the interview, adding that the United States was no different than an insurance company.
Relations between Taiwan and China are a sensitive topic, as Beijing has consistently called for the reunification of Taiwan and the mainland. The United States is the island’s largest defense supplier, but it has no formal diplomatic agreement with Taipei.
Concerns about Trump’s presidency have also rattled Chinese markets in recent sessions, as the former president has maintained strong rhetoric against the country. His administration sparked a trade war with Beijing in the late 2000s.
Chinese markets also suffered losses due to a series of weak economic readings in the country.
Tech stocks fall as key earnings loom
Asian technology stocks, especially chipmakers, fell on Wednesday as expectations of interest rate cuts drove flows into more economically sensitive sectors.
Shares of major chipmakers were also nervous ahead of the sector’s key earnings this week, with ASML Holding NV (AS:) ADR (NASDAQ:) and TSMC (TW:) (NYSE:) reporting earnings on Wednesday and Thursday, respectively.
Both are an indicator of demand for chips, which has risen sharply over the past year amid growing interest in artificial intelligence.
TSMC shares fell about 2% after Trump’s comments on Taiwan.
Chipmakers suffered losses, with Japanese shares rising just 0.2%, while South Korean shares lost 0.2%.
Other Asian indices — especially those with a smaller weighting in the technology sector — rose on the prospect of a rate cut. Japan’s index rose 0.5%, while Australia’s rose 1% to a record high.
India index futures pointed to a positive open as the index and stock market continued to hit record highs amid continued optimism about the Indian economy.