- South Korea's Kospi opened down 5.89% with Kosdaq dropping 3.62% and trading halted
- Japan's Nikkei 225 fell nearly 3% and Topix declined 1.01%
- Asian tech stocks fell sharply, led by Samsung, SK Hynix, SoftBank, and Tokyo Electron
Asian Markets Today | Aug. 19: Asia-Pacific markets opened lower Wednesday, with South Korea's Kospi benchmark leading declines. The Kospi dropped 5.89% at open, while the tech-heavy small-cap Kosdaq index was 3.62% lower, leading to a temporary halt in trading. Kospi heavyweights Samsung and SK Hynix were down over 7% and over 5%, respectively. Japan's Nikkei 225 fell over 3% after opening while the Topix declined 1.01%. Australia's benchmark S&P/ASX 200 slipped 0.50%.
This comes after most Asian tech stocks slumped tracking their US peers, which pulled back due to global bonds. In Japan, SoftBank Group dropped 5.44%, while chip equipment maker Tokyo Electron was 3.85% lower. Advantest lost 3.93%, and Japanese memory chipmaker Kioxia declined 9.13%. In South Korea, SK Hynix fell 8.66%, while Samsung Electronics slipped 7.08%. Seoul Semiconductor declined 4.33%. Tech stocks have seen heightened volatility in recent sessions, with South Korea's semiconductor-heavy market whipsawing between steep losses and record gains.
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Global tech stock crash on high bond yields
Global tech stocks dropped as bond yields in the US and elsewhere scored fresh milestones. The 30-year Treasury yield hit a new 19-year high on Tuesday, while Japan's 10-year bond yield reached its highest level in three decades. German 30-year bund yields hit their highest point since 2011, while rates on France's 30-year bond hit the highest since 2008. Investors bet on steady economic growth, in tandem with historically strong earnings for companies, will continue to support the stock market in the face of higher yields. Despite the tech crash, the overall market reaction was muted in the US stock market.
Global Crude Oil Prices
Oil prices rose for a fourth straight session on Wednesday as the US-Iran conflict showed little sign of moving towards a resolution, keeping uncertainty around the Strait of Hormuz at the centre of the energy market. Brent crude traded above $91, after rising 4.5% over the previous three sessions, while West Texas Intermediate was near $85. US President Donald Trump that there were no talks underway with Tehran, reducing hopes of a near-term breakthrough after almost six months of conflict.
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Crude prices have surged since the conflict began in late February, adding to inflationary pressure across economies. Energy markets are also dealing with disruptions linked to the Russia-Ukraine war, including attacks on refineries. The lack of negotiations leaves the future of the Strait of Hormuz uncertain. Iran and the US remain divided over how the waterway should be managed, while traffic through the key route linking Persian Gulf producers with global markets remains limited.
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