Technology shares bore the brunt of investor skepticism, pulling down key Asian markets as traders reacted to a recent slump in U.S. tech and semiconductors. The impact was felt strongly, with Kioxia Holdings, a major chipmaker, sinking 10.2 percent after SanDisk's guidance for the upcoming quarter fell short of analysts' forecasts. The stock had seen a brief rebound in the prior two sessions but was unable to sustain that momentum.
The broader tech sector in Asia continued to struggle. The sell-off reflected fears that returns from such ventures may not justify the costs.
Meanwhile, gold prices reached a seven-week peak, climbing for the fourth day in a row to $4,253 an ounce. The rise was spurred by soft U.S. labor market data and a weaker dollar, making the precious metal more attractive to global investors. The market is now awaiting Friday’s U.S. nonfarm payrolls report for clarity on the economic outlook. Some Fed officials have already hinted at the need for tighter monetary policy to curb inflation.
Australia, in contrast, outperformed its regional peers. The S&P/ASX 200 hit a new record, gaining 0.47 percent to 9,271.60, with mining stocks enjoying the spotlight due to surging copper prices. Rising optimism over a potential U.S.-Iran deal boosted investor confidence. Copper prices reached a three-month high, further lifting sentiment in the mining industry.
New Zealand's S&P/NZX-50 index gave up 0.28 percent, ending a three-day upward trend. Meanwhile, the Shanghai Composite in China rose 0.57 percent to 3,900.35, propelled by higher gold prices and gains in bullion-related equities.
Japan's markets were caught in a tug-of-war, with the Nikkei average falling 0.93 percent to 65,683.26 despite easing geopolitical tensions in the Middle East. The broader Topix index, however, ended up 0.24 percent at 4,055.85. Technology and AI-linked stocks were the main culprits behind the decline, as Advantest, SoftBank, and Tokyo Electron all fell between 2 and 3 percent.
The sharp decline was fueled by a broader selloff in tech and AI stocks. Reports of increased scrutiny over the long-term viability of AI spending further dampened investor morale.
Hong Kong's markets also faced downward pressure, with the Hang Seng index falling 1.49 percent to 25,530.28. Financial stocks, especially those in the insurance and banking sectors, were hit hard following news that tax authorities in mainland China had begun collecting personal income tax on returns from offshore insurance policies.
Overnight in the U.S., stocks finished mixed. The Dow climbed half a percent to a new record, buoyed by hopes of a deal to reopen the strategically vital Strait of Hormuz. However, the S&P 500 edged down 0.2 percent as data showed a slowdown in private-sector hiring in July. The manufacturing sector continued to expand, but at a slower pace. The Nasdaq Composite dropped 0.8 percent, marking its first loss in five days as companies like SpaceX and AMD underperformed following earnings reports.