By Laura He and Michael Kitchen, MarketWatch
HONG KONG (MarketWatch) -- Asian stocks declined sharply on
Wednesday, with Japan leading losses on a firmer yen and a sell-off
overnight on Wall Street.
Following substantial losses in U.S. markets, Japan's Nikkei
Average tumbled 2.9% at the close, while the yen (USDJPY)
strengthened against the dollar as the dollar bought Yen101.502
from Yen101.678 in the previous day.
Hong Kong's Hang Seng Index finished 1.1% lower, South Korea's
Kospi index ended down 1%, China's Shanghai Composite Index fell
0.9%, and Australia's S&P/ASX 200 lost 0.8%.
Some of major movers include Japanese tech giant SoftBank Corp.
plunging 5.1%, Renesas Electronics Corp. sliding 4.5%, Olympus
Corp. falling 3.5%, and Panasonic Corp. losing 3.4%.
Hong Kong-listed tech stocks were also weak, with Chinese
Internet giant Tencent Holdings (TCEHY) dropping 3.8%, and software
provider Kingsoft Corp. falling 7.6%.
Property developers and casinos fell broadly in Hong Kong. Among
the top decliners, Shimao Property Holdings dropped by 6%, and
Vanke Property (Overseas) pulled back 5.7%. Macau casino operator
Melco Crown Entertainment gave up 4.1%, and both Galaxy
Entertainment Group and MGM China Holdings were off 3.4%.
China's service sector slowing, too
The downward revision to HSBC's China manufacturing PMI dragged
down Hong Kong stocks earlier this week, and now it turns out that
HSBC's services PMI is also on the decline.
The April report, released earlier Wednesday, showed the
headline number falling to 51.4 from March's 51.9, though remaining
above the 50 level separating expansion from contraction.
The details weren't great either, with the employment subindex
hitting a seven-month low to stand just above the 50 mark.
HSBC chief China economist Hongbin Qu took a bit of comfort from
the fact that, unlike with the manufacturing gauge, the services
PMI still indicates a growth in activity.
"Today's release showed that the service sector is still a
relatively resilient part of the economy, but it is not expanding
at a fast enough pace to offset the manufacturing slowdown," Qu
wrote in comments accompanying the data.
Nonetheless, HSBC is holding to its view that China's economy
will remain "on a modest path of expansion over the next few
months," Qu wrote.
(This post originally appeared as part of MarketWatch's Asia
Markets live blog.)
More news from MarketWatch:
Beware: Alibaba IPO isn't really selling Alibaba
Inside the mind of Alibaba's Jack Ma
Alibaba: IPO sparks excitement, caution
Subscribe to WSJ: http://online.wsj.com?mod=djnwires