On Wednesday, many stocks in Asia experienced a decline due to ongoing concerns about a potential economic slowdown this year. However, technology-focused indexes were boosted by impressive earnings reports from significant American companies.
The Hang Seng index in Hong Kong was the only exception on that day, increasing by 0.7%. This rise was due to gains in technology stocks, which have a strong connection to the U.S. market, such as Alibaba Group Holding Ltd (HK:9988) (NYSE:BABA) and Baidu Inc (HK:9888) (NASDAQ:BIDU).
Asian indexes that have a focus on technology also experienced relatively smaller declines. South Korea's KOSPI remained unchanged, while Taiwan's Weighted index dropped by 0.3%. In India, the BSE Sensex 30 and Nifty 50 indexes remained flat at the beginning of the trading day due to the strength of significant technology stocks.
On Wednesday, overall Asian markets experienced a decline, primarily due to increasing concerns about a potential economic downturn in the United States. These worries negatively impacted risk-oriented markets. Moreover, weak financial results from First Republic Bank (NYSE:FRC), which announced a sharp drop in deposit levels, renewed concerns about a potential banking crisis.
Despite Wall Street indexes closing lower on Tuesday, Microsoft Corporation (NASDAQ:MSFT) and Alphabet Inc (NASDAQ:GOOGL) announced their first-quarter results after the market closed, surpassing market expectations. As a result, both stocks experienced a rise in after-hours trading. The
better-than-expected results also indicated that the substantial technology companies were under less pressure from inflation and rising interest rates.
The upcoming release of U.S. GDP data on Thursday, which is expected to reveal a slowdown in growth during the first quarter, has become the center of attention. In Southeast Asia, markets with a higher risk profile saw the most significant declines. Thailand's SET Index and the Philippine Composite both decreased by 1.1% and 0.8%, respectively.
In China, the Shanghai Shenzhen CSI 300 and Shanghai Composite indexes fell by 0.2% and 0.3%, respectively, due to ongoing concerns regarding an uneven economic recovery in the country. The focus has now shifted to the release of data on Chinese industrial profits on Thursday, which will indicate the condition of the manufacturing sector. In Australia, the ASX 200 fell by 0.1% as inflation data showed that price pressures remained high in the first quarter, which could lead to interest rate hikes by the Reserve Bank.
The Nikkei 225 index in Japan fell by 0.7%, although it performed better than its Asian peers this week because Bank of Japan governor Kauzo Ueda reaffirmed his intention to maintain an ultra-loose policy in the near future. The focus is now on the inflation reading and a BOJ meeting on Friday, which will determine when the central bank will begin tightening its policy later this year.
