Technology stocks led the way lower in Asia on Wednesday, dragged by the sector’s slide in the U.S.
The Nikkei Stock Average NIK, -1.79% sank as much as 2.5% in early trading, led by energy, transportation and tech shares. The index jumped 2.7% on Tuesday, but was last down 2.1% even though the yen reversed some of the gains it made in U.S. afternoon trading.
Other stock benchmarks in Asia Pacific fell less than 1% early on Wednesday, though New Zealand’s NZX-50 NZ50GR, -1.36% skidded 1.5%. The New Zealand market was weighed by a2 Milk ATM, -6.07% , the country’s biggest company by market capitalization, which sank 7% on a report that Nestlé NESN, +1.37% has launched a competing infant-formula product in China. Still, a2 Milk shares are up 60% this year. Markets in Shanghai SHCOMP, -0.24% and Hong Kong HSI, -0.66% were down almost 1%/
Some traditional safe havens saw buying. Gold futures and government-bond prices rose.
The 10-year Treasury yield fell, and hit levels last seen in early February at 2.78%, “as bond investors reacted to turmoil surrounding technology stocks, specifically Facebook,” analysts from Lucror Analytics wrote in a research report. The yield on 10-year German bunds dropped to 0.5% for the first time in almost three months; yields fall when bond prices rise.
Analysts from Société Générale said pricing reflects “a scenario of extreme prudence” from the European Central Bank but would look “stretched” if the central bank ends its bond-buying program in 2018 and starts raising rates the following year.
In commodities markets, oil futures are down 0.6%, maintaining the drop seen after the U.S. settlement Tuesday as prices were hit by the slide in U.S. stocks.
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