Investing.com — Concerns that U.S. interest rates will remain high for an extended period remain as tech stocks track losses among Wall Street peers following disappointing guidance from internet giant Meta Platforms. Most Asian stocks fell on Thursday.
U.S. stock index futures fell sharply in Asian trading, with losses widening for tech stocks as Meta and its peers fell in after-hours trading. Meta (NASDAQ:) fell 15% after the company said it expects second-quarter revenue to be lower than expected due to higher costs related to artificial intelligence.
This raised concerns about how much benefit AI could bring to technology companies, given that it also comes with much higher costs. Meta's outlook paints a gloomy picture for the future earnings of Microsoft Corp. (NASDAQ:) and Alphabet Inc. (NASDAQ:).
Japan's Nikkei Stock Average falls due to high-tech losses, Bank of Japan hopes
Japan's index was the worst performer in Asia, falling 1.8% due to declines in large-cap tech stocks.
Expectations for the Japanese market also rose on Friday, with stocks generally falling 1.1%.
While the Bank of Japan is widely expected to keep interest rates on hold after its historic rate hike in March, the market remains hawkish on inflation, especially after recent signs of improved wage growth and resilience in the Japanese economy. I was alert to the signals.
An announcement is expected on Friday, with inflation expected to rise modestly through April.
South Korea's KOSPI fell as technology uncertainties offset strong earnings and GDP
South Korean stocks fell 1% on Thursday, as weak buying from Wall Street largely offset strong earnings and economic data, weighed down by declines in tech stocks.
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memory chip manufacturers SK Hynix Co., Ltd. (KS:) fell 3.3% despite posting a much better-than-expected first-quarter profit on the back of AI demand. However, the company also expects expenses to increase as it ramps up production to meet the expected surge in demand.
peer Samsung Electronics Co., Ltd. (KS:) fell 1.9%. These two stocks are by far the largest on KOSPI.
Weakness in tech stocks offset optimism over data showing South Korea's economy grew 1.3% in the first quarter, more than double expectations.
Other Asian markets were a bit more mixed. China's indexes and indexes fell slightly, but Hong Kong's index extended its rebound to hit a five-month high.
India's index futures suggested calm trading as sentiment cooled towards the country ahead of the 2024 general elections that begin on Friday. The incumbent Bharatiya Janata Party is expected to win a third consecutive term.
The Australian market was closed due to the public holiday.
