Tech giants including Samsung and Tencent sank in Asian trade on Tuesday, tracking a sell-off in their US rivals and dragging most regional markets lower.
While investors welcomed news that the US Senate had finally passed controversial tax reforms, the deal must still be reconciled with a House bill, while the probe into alleged Russian meddling in last year’s election continues to dog Donald Trump.
The Dow closed at a record high on Wall Street but the Nasdaq tumbled more than one percent as dealers shifted out of the tech sector, which has enjoyed a healthy rally through the year, and into financial firms.
“Renewed weakness in the tech sector weighed at the bell” in New York, said Stephen Innes, head of Asia-Pacific trading at OANDA.
“However, it’s not as if the tech sector is under stress but rather some equities rotation remain in vogue as investors seek out opportunities in more tax reform sensitive stocks.”
Samsung fell 0.4 percent, while Tencent sank 1.3 percent and Sharp lost 1.6 percent.
On broader markets Tokyo ended the morning session 0.4 percent lower, Hong Kong eased 0.2 percent, while Sydney and Shanghai each dipped 0.1 percent
Wellington, Taipei and Kuala Lumpur were also lower but Seoul, Singapore and Manila edged up.