Asian and European Stocks Drop, Following Wall Street’s Lead
Worries about the tech world added to broader concerns that include the impact of the trade war between the United States and China and signs of slowing growth around the globe. Investors in the Chinese markets of Shanghai and Shenzhen led the selling in Asia.
European markets were in the red in morning trading, with the stocks of technology companies and banks leading the fall.
Futures markets that track the performance of stocks in the United States suggested the market would extend the losses when markets there opened.
Some of the same concerns that hurt technology stocks in the United States have hit companies in other parts of the world.
In Hong Kong, Shanghai and Shenzhen, trade concerns helped to push the stocks of Chinese semiconductor makers and other big technology companies into the red. A drop in the stock price of the chip maker Nvidia several days ago after disappointing earnings may also have rattled investors in chip makers across China. The Chinese stock market is down by more than 20 percent so far this year.
Shares of Tencent, the Chinese internet conglomerate, fell 3.3 percent in Hong Kong trading. A broader index of large Chinese companies listed in Hong Kong dropped by 1.6 percent, while the Hong Kong market closed the day down 2 percent.
“Stocks look weak,” Robert Carnell, chief economist for Asia Pacific at the Dutch bank ING, wrote in a note to investors. “Oversupply in the semiconductor industry is an issue for Asia, and made worse by an apparent lack of demand for some well-known producers of high-tech products,” he added.
Trade frictions also continue to overhang markets. World leaders are meeting next week in Argentina for the Group of 20 conference, which President Trump and President Xi Jinping of China will attend. Hopes that the two sides would come to a trade agreement on the sidelines have waned since officials from both countries sparred over the weekend at the Asia-Pacific Economic Cooperation summit meeting in Papua New Guinea.
Stocks in Japanese automobile companies helped to drag the benchmark exchange in Tokyo down by 0.7 percent. The sell-off was prompted in part by news that Carlos Ghosn, the chairman of Nissan, was arrested on Monday after the carmaker found that he had underreported his compensation to the Japanese government. Shares in Nissan fell 5.5 percent in Tokyo.
In Seoul, South Korea, and Taipei, Taiwan, the markets finished the day down nearly 1 percent.
The United States appeared poised for another day of selling with futures trading down. The dollar also weakened slightly, while the euro strengthened slightly.