Tech Sector Under Pressure in Europe, Asia
By Kenan Machado and Riva Gold -- Oil retreats from 2 1/2 -year high -- Tech stocks lag in Europe and Asia -- Dollar softens
Technology shares remained under pressure in Europe and Asia on Wednesday while a recent rally in oil and copper prices boosted global energy and mining companies.
The Stoxx Europe 600 edged down 0.1% in afternoon trading as regional markets reopened from a holiday, although market moves and volumes were muted in the quiet period between Christmas and New Year's Day. Futures pointed to a 0.1% opening advance for the S&P 500.
Shares of technology companies fell in Europe and Asia Wednesday, leading declines there, after a drop in their U.S. counterparts on Tuesday. Shares of Apple and some of its suppliers dragged down major U.S. indexes in a fall analysts attributed to reports that the company is considering cutting its first-quarter sales forecast for its iPhone X.
In Shanghai, smartphone-related companies fell to begin the week, and the technology sector also led declines in Hong Kong and Australia. While the smartphone supply chain will be under pressure in the seasonally weak first quarter, fundamentals aren't deteriorating, said President Securities.
The MSCI AC World technology sector is still on track to end the year about 40% higher than it started.
Tech has been the world's best-performing sector this year, so it isn't surprising there has been a year-end pullback, said Felix Lam, a portfolio manager at BNP Paribas Asset Management.
Among gainers on Wednesday, Europe's oil-and-gas and basic resources sectors were up 0.5% and 1.1%, respectively, after a holiday, catching up with Tuesday's rally in oil and copper prices and gains in their Asian counterparts.
U.S. crude futures briefly popped above $60 a barrel Tuesday after a pipeline explosion in Libya -- ending the day up 2.6% at the highest settlement since June 2015 -- before edging down 0.8% to $59.48 a barrel on Wednesday. The incident is expected to reduce oil production there by up to 100,000 barrels a day, the country's National Oil Co. said on its website.
Shares of global mining giants also drew support from a climb in copper prices. London-listed copper futures were last up 0.8% at $7,193 a ton, around their highest in nearly four years. The metal, which is heavily used in construction and manufacturing, has benefited from improving economic growth in the U.S. and indications of stronger demand from China.
Earlier, the Shanghai Composite fell 0.9% with insurers faring worst, and the CSI 300 -- made up of the biggest stocks in both Shanghai and Shenzhen -- slid 1.5%. That came as data showed China's industrial-profit growth slowed sharply in November, due to slower growth in prices for industrial goods and higher production costs.
Shares of Chinese property developers rebounded in Hong Kong, helping the Hang Seng Index rise 0.1% despite losses in the technology sector.
South Korea's Kospi edged up 0.4% as shares of index heavyweight Samsung Electronics rebounded and shares of pharmaceutical companies rose. That helped offset a 29% drop for Hyundai Heavy Industries. The world's biggest shipbuilder suffered its worst day ever announcing a 1.3 trillion won ($1.2 billion) stock-sale plan.
In currencies, the WSJ Dollar Index, which tracks the dollar against a basket of 16 others, was down 0.2%.
The euro was last up 0.3% at $1.1896, having fully recovered after a sudden drop on Christmas day briefly sent it down around 3%. Analysts attributed the move to stressed dollar liquidity amid light holiday volumes.
Marc Navarro Gonzalez
contributed to this article.
Write to Kenan Machado at firstname.lastname@example.org and Riva Gold at email@example.com
(END) Dow Jones Newswires
December 27, 2017 09:03 ET (14:03 GMT)Copyright (c) 2017 Dow Jones & Company, Inc.