On Friday, Asian stock markets continued their decline after opening, particularly in the technology sector, due to escalating tensions in US-China relations. Investors anticipate US interest rates remaining high for a longer period, driving the US dollar to its longest streak of gains in nine years.
In early trading, the MSCI Asia Pacific stock index (excluding Japan) fell by 0.2%, having already declined by 1.4% this week. Among major Asian stock indices, the Nikkei 225 index fell by 0.95%, South Korea's KOSPI index by 0.49%, the Shanghai Composite index by 0.47%, the Shenzhen Component index by 0.70%, and the Hong Kong Hang Seng index was suspended due to severe weather.
Media reports about China restricting national employees from using iPhones not only caused Apple's market value to evaporate by about $200 billion within two days but also put pressure on the stock prices of Asian chip suppliers. Among them, Taiwan's TSMC (Taiwan Semiconductor Manufacturing Company) opened with a 1% drop, Tokyo Electron's stock price fell by 4.3%, and South Korea's SK Hynix's stock price plummeted by up to 4.5%.
Kyle Rodda, an analyst at Capital.com, noted that although the impact of China's ban on certain Apple products is limited, it highlights the mutual costs and potential risks of decoupling between the US and China, bringing trade tensions and the issue of US-China decoupling back into the market's focus.
In Thursday's trading, influenced by the fall in technology stocks such as Apple, the S&P 500 index closed down 0.32%, and the Nasdaq index closed down 0.89%.
Meanwhile, the expectation that US interest rates may remain at their highest levels in 20 years has, on one hand, strengthened the yield on US Treasuries across all maturities, raising real interest rates and the cost of funding, dragging down the valuation and profit expectations of companies, especially technology firms. On the other hand, it has supported the strong performance of the US dollar index, putting pressure on major currencies, particularly those of emerging Asian markets.
Analysts at ANZ Bank have pointed out that considering the economic challenges faced by China and signs of re-tightening in some US data, the "dominant performance" of the US dollar and US Treasury yields will continue their trend of ravaging the financial markets.
This week, the US dollar reached a 10-month high against the Japanese yen, putting significant pressure on the Bank of Japan and Japanese authorities. Masato Kanda, Japan's chief currency diplomat, stated on Wednesday that the Japanese authorities would not exclude any options to limit "speculative" activities, as the government is closely monitoring the situation.
