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Technology firms led a sell-off across Asian markets Tuesday on fresh concerns about demand for Apple’s iPhones, while Japanese car giant Nissan and Mitsubishi plunged on news chairman Carlos Ghosn had been arrested over alleged financial misconduct.
After a brief couple of days of stability, panic returned to trading floors following a report that the US titan had slashed production of its popular handset, agency reports.
That comes just a week after a supplier suggested the firm had cut orders, fanning speculation the latest incarnation of the gadget is not selling as much as hoped.
Apple collapsed four percent in US trade with Facebook, Amazon, Google parent Alphabet and Microsoft each diving three percent or more.
The losses filtered through to Asia, where Apple suppliers were also in trouble.
In Tokyo, Japan Display, which has lost about a third of its value over the past week, was off 3.9 percent by the break while Alps Electric fell 1.3 percent. Among other tech firms Sony shed 2.6 percent and Hong Kong-listed
Sunny Optical Technology dived 2.8 percent.
Taiwan Semiconductor Manufac­turing Company shed 1.1 percent in Taipei and Delta Electronics was off 0.8 percent.
Broader markets were also well down as investors fret over a number of issues, with attention now turning to next week’s G20 summit in Argentina, where Donald Trump is expected to meet Chinese President Xi Jinping to talk trade.
There had been some hope that the world’s two economies could find a resolution to their painful tariffs row but a clash of words at the weekend between Xi and Trump’s vice president Mike Pence has muddied the waters.
“A comprehensive trade agreement at the G20 that rolls back the tariffs still looks unlikely,” warned Bank of Singapore currency strategist Sim Moh Siong. “But a constructive US-China statement, agreement to restart talks and a tariff pause appear to be emerging possibilities.
“The most positive outcome at G20 would be the White House ‘stopping the clock’ on the now-scheduled ramp-up in tariffs from a 10 percent rate to a 25 percent rate, moving that date from 1 Jan 2019 to a later date.”
This, he added, would provide some stability to the Chinese yuan and under-
pressure Asian currencies.
Hong Kong fell 1.4 percent in the morning, Shanghai was off one percent,
while Sydney, Seoul and Singapore each fell 0.8 percent. Wellington dropped
one percent, Manila 1.2 percent and Taipei 0.6 percent.
Tokyo was down 0.9 percent by lunch.
Nissan lost 4.3 percent and Mitsubishi sank 7.1 percent as they prepared to
sack Ghosn after it emerged he had been taken into custody as detectives
looked into claims he under-reported his income for years.
Ghosn has long been a major player in the car industry and is credited with
resurrecting the once-troubled Nissan, which he allied with Mitsubishi and
France’s Renault.
Renault’s share price plunged eight percent in Paris.
Nissan CEO, Hiroto Saikawa insisted the partnership among the three “will
not be affected by this event” but had no details on how the other firms
would respond, or who might succeed Ghosn.
– Key figures around 0230 GMT –
Tokyo – Nikkei 225: DOWN 0.9 percent at 21,633.64 (break)
Hong Kong – Hang Seng: DOWN 1.5 percent at 25,974.16
Shanghai – Composite: DOWN 1.0 percent at 2,676.80
Euro/dollar: DOWN at $1.1448 from $1.1452 at 2200 GMT
Pound/dollar: UP at $1.2853 from $1.2850
Dollar/yen: UP at 112.60 yen from 112.54 yen
Oil – West Texas Intermediate: UP three cents at $57.23 per barrel (new
contract)
Oil – Brent Crude: DOWN four cents at $66.75 per barrel
New York – Dow: DOWN 1.6 percent at 25,017.44 (close)
London – FTSE 100: DOWN 0.2 percent at 7,000.89 (close)