By Associated Press and MarketWatch
Asian markets were mostly lower Thursday after tumbling more than 1% on the first trading day of 2019. Apple downgraded its sales projections, citing slowing Chinese growth, hitting technology shares in South Korea and Taiwan. The Japanese yen, seen as a relatively safe asset, strengthened against the dollar, euro and several other Asian and European currencies.
South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 -0.83% lost 0.2% and Taiwan’s benchmark fell 0.6%. The Shanghai Composite index /zigman2/quotes/210598127/delayed CN:SHCOMP -0.59% was flat, while Hong Kong’s Hang Seng /zigman2/quotes/210598030/delayed HK:HSI -1.68% was down 0.3%. Australia’s S&P-ASX 200 /zigman2/quotes/210598100/delayed AU:XJO -0.71% rebounded 1.4%. Shares fell in Singapore /zigman2/quotes/210597985/delayed SG:STI -0.06% but rose in Indonesia /zigman2/quotes/210597981/delayed ID:JAKIDX -0.22% . Japan’s markets were closed.
Apple CEO Tim Cook said in a letter to shareholders released after markets closed on Wednesday that he expects the tech giant’s revenue for the October-December quarter to fall below internal and analysts’ projections. Apple /zigman2/quotes/202934861/composite AAPL -3.17% now expects revenue of $84 billion for the quarter, about 9 percent lower than the $91.3 billion estimate from analysts polled by FactSet. The official results will be released on Jan. 29. Cook attributed most of the revenue drop to China, where the economy has been slowing and where U.S. tariffs have been raised on more than $200 billion in goods, although the iPhone hasn’t been affected directly so far. The company’s shares fell 7.6% to $146 in after-hours trading.
Asian tech stocks were especially hard hit following Apple’s announcement. In Korea, Samsung /zigman2/quotes/209800866/delayed KR:005930 +0.17% and SK Hynix /zigman2/quotes/206420319/delayed KR:000660 +0.96% tumbled, while Apple suppliers such as AAC /zigman2/quotes/201441510/delayed HK:2018 -2.66% and Sunny Optical /zigman2/quotes/206687505/delayed HK:2382 -0.33% each fell more than 4% in Hong Kong, and in Taiwan, Hon Hai Precision Industry /zigman2/quotes/207256514/delayed TW:2317 -0.26% and Taiwan Semiconductor /zigman2/quotes/207385621/delayed TW:2330 -0.90% sank.
A turbulent day on Wall Street saw stocks plunging before recovering and finishing slightly higher. Surveys by the China’s government and a major business magazine that showed Chinese manufacturing had slowed in December weighed on sentiment. Still, the broad S&P 500 index /zigman2/quotes/210599714/realtime SPX -1.12% added 0.1% to 2,510.03 on Wednesday. The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -0.88% , which lost 398 points in the first few minutes of trading, closed 0.1% higher at 23,346.24. The Nasdaq composite /zigman2/quotes/210598365/realtime COMP -1.07% rose 0.5% to 6,665.94. The Dow future contract was down 1.4% early Thursday and that for the S&P 500 lost 1.3%.
“A flight to safety following the series of aggravating releases since the turn of the year saw the rush into the yen this morning. Doubling down on Asia markets for a second day today would be the latest downward revision in Q1 guidance from tech giant, Apple,” Jingyi Pan of IG said in a market commentary. “The already shaky foundation for Apple owing to the likelihood of the company’s products being enlisted into the tariffs scuffle saw their latest move to lower revenue outlook packing a punch for share prices,” she added.
Oil prices, which have fallen about 40% since October, settled after jumping at the start of the year. Benchmark U.S. crude shed 83 cents to $45.71 per barrel in electronic trading on the New York Mercantile Exchange. The contract jumped 2.5 percent to $46.54 per barrel on Wednesday. Brent crude , used to price international oils, lost 43 cents to $54.48 per barrel. It added 2.1 percent to $54.91 per barrel in London.
The dollar /zigman2/quotes/210561789/realtime/sampled USDJPY -0.2400% weakened to 107.16 yen from 108.86 late Wednesday.