Asian Stocks Drop as Tech Sector Falters Amid US Debt and Trade Worries

Most Asian stocks fell on Thursday, mirroring steep losses on Wall Street as fears over the U.S. economy and mounting government debt rattled investor sentiment. Technology shares led the decline, tracking losses in U.S. peers amid rising Treasury yields and renewed trade tensions.

South Korea’s KOSPI dropped 1.2%, and Hong Kong’s Hang Seng fell 0.5%, dragged by tech sell-offs. Investors trimmed exposure after U.S. yields surged, pressuring valuations in the rate-sensitive sector. Negative sentiment deepened following China’s sharp criticism of tightened U.S. chip export controls, which Beijing said violated a recent trade truce. Nvidia CEO Jensen Huang also slammed the restrictions as a policy failure.

Chinese tech stocks slumped, with Baidu Inc. shedding nearly 3% despite beating Q1 earnings forecasts, and Contemporary Amperex Technology losing 2% after a strong Hong Kong debut. Meanwhile, U.S. fiscal concerns worsened after Moody’s downgraded the country’s credit outlook, amplifying fears over rising debt linked to a pending tax cut bill.

Japanese markets also slid, with the Nikkei 225 down 0.9% after PMI data showed sustained weakness in manufacturing and a sharp slowdown in services. Japan’s composite PMI dipped into contraction, highlighting export struggles tied to U.S. tariffs.

Australia’s ASX 200 lost 0.5% on weak services PMI data, while Singapore’s Straits Times index also fell 0.5% despite slightly better-than-expected Q1 GDP growth. India’s Nifty 50 futures pointed to a flat open ahead of local PMI releases.

China’s CSI 300 and Shanghai Composite bucked the trend with modest gains amid hopes of further economic stimulus. Still, overall risk appetite in Asia remained subdued, weighed by global uncertainties and profit-taking in high-growth sectors.