World Economy

Asian Shares Pull Back After US Tech Stocks Retreat

Asian Shares Pull Back After US Tech Stocks RetreatAsian Shares Pull Back After US Tech Stocks Retreat

Asian stock markets sagged on Friday after US tech shares retreated from recent rallies, though optimism about US corporate earnings and the global economy underpinned overall sentiment.

European shares were expected to open lower, with spread-betters looking for Germany’s DAX to fall 0.7% and Britain’s FTSE to drop 0.6%, Reuters reported.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.1%, erasing almost all of its weekly gains, with Samsung Electronics, Asia’s largest company by market capitalization, dropping 4.4%. Japan’s Nikkei shed 0.6%.

On Wall Street, the Dow industrials set a record closing high, helped by a 7.7% jump in Verizon following the top US wireless carrier’s quarterly earnings.

But investors were spooked by a sudden drop in technology and transportation shares. The S&P 500 technology sector fell 2% at one point before ending the day down 0.8%.

After the bell, shares—up nearly 40% this year—fell 3% after the online retailer reported a slump in profits, which helped drag US stock futures down 0.3% in Asia.

“Given the Dow is hitting a record high, it’s hard to think market sentiment has suddenly changed,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

The S&P 500 index is on track to post back-to-back, double-digit quarterly earnings growth for the first time in almost six years.

Japanese economic data released on Friday came in stronger than expected, with household spending rising more than forecast and the jobless rate unexpectedly falling.

MSCI ACWI, a gauge of the world’s 47 stock markets in dollar terms, hit a record high on Thursday, having gained 2.8% this month.

If the gains are sustained by Monday, it would mark the biggest monthly jump in a year, and the ninth consecutive month of increases—the longest such spell since 2003-04.

In the currency market, the dollar regained some footing after slumping to a 13-month low against a basket of major currencies the previous day when the US Federal Reserve’s policy statement led to the perception that it has grown cautious about soft inflation.

The euro consolidated at $1.169, after hitting a 2 1/2-year high of $1.177 on Thursday. The dollar eased 0.3% to 110.99 yen, a tad above Monday’s low of 110.625, its lowest in more than five weeks. The dollar has been also pressured by doubts US President Donald Trump could carry out his tax cut plans.

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