Asia-Pacific Markets Slide Broadly as Tech Selloff and Rate Fears Weigh on Sentiment

Deep News
Sep 28

Major A-share indices opened lower and extended losses throughout the session. By the close, the Shanghai Composite fell 1.67%, the Shenzhen Component dropped 3.44%, and the ChiNext Index plunged 4.53%. Combined turnover across the Shanghai and Shenzhen markets reached 1.7 trillion yuan, up 49.4 billion yuan from the previous trading day. More than 4,500 individual stocks declined across the market.

On the sector front, automakers saw a notable intraday rally, with Jianghuai Automobile notching its third limit-up in four days and Zotye Auto hitting the daily cap. Glass substrate-related names were active, with Ledman Optoelectronic surging over 12%. Cybersecurity stocks stood out, as Yongxin Zhijie rose 20% to its limit and Zhongxin Saike also hit the ceiling. Real estate developers performed well, with Shenzhen Property A and Shenhua A both locking in limit-up gains.

On the downside, high-flying momentum stocks suffered a broad selloff. Daya Shengxiang, Inner Mongolia Xinhua, Jinjian Cereals, Aohong Electronics, Taimusi, Nanhua Bio, and Tianwei Video all fell by the daily limit. Precious metals weakened, with Shandong Gold hitting the floor while Xiaocheng Technology and Hunan Silver also declined sharply.

In Japan and South Korea, the Nikkei 225 closed down 0.73% at 65,877.62, while South Korea's KOSPI dropped 2.70% to 6,889.75. Samsung Electronics slid 5.43% and SK Hynix fell 5.05%.

On the news front, OpenAI reportedly said on September 26 local time that it has paused training of its latest-generation artificial intelligence model, according to the Associated Press report. This development intensified market concerns over the sustainability of AI computing demand, dealing a direct blow to global technology stock sentiment.

From a liquidity perspective, the U.S. 10-year Treasury yield climbed again, with the 30-year long-end yield rising in tandem. Elevated global risk-free rates are exerting systemic pressure on high-valuation technology sectors. According to CME's "FedWatch" tool, the probability of a 25-basis-point rate hike by the Federal Reserve in October has risen to 67.5%.

Meanwhile, with the National Day holiday approaching, risk-aversion sentiment has clearly intensified. Investors' willingness to lock in profits has strengthened, further amplifying market volatility.

Galaxy Futures financial derivatives analyst Sun Feng told Futures Daily that cautious观望 sentiment is dominating the market ahead of the National Day holiday. Due to the extended market closure, investors are generally choosing to stay on the sidelines, leading to a noticeable contraction in trading volume. The outcomes of China-U.S. talks had already been priced into market expectations, and profit-taking has been widespread. Over the weekend, the U.S. FCC updated relevant information, drawing mixed interpretations from market participants, but the disruptions to the optical module sector from related factors will persist over the long term. Overall, the A-share market remains in a phase of digesting various pieces of information, and is expected to maintain a range-bound trend before the holiday.

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