HK slips as Korean results raises stakes for AI giants
Asian shares gave up earlier gains on Thursday as AI-related earnings announcements prompted wildly mixed responses, raising the stakes for Amazon and Intel results due later in the day. In Hong Kong, the benchmark Hang Seng Index opened down six points, or 0.03 percent, at 23,088. The tech index slipped 19 points, or 0.5 percent, to 3,834 while the China Enterprises Index inched down six points,…
Asian stock markets opened lower on Thursday as AI-related earnings announcements yielded contrasting results, intensifying the pressure on tech giants like Amazon and Intel scheduled to report results later. Hong Kong's benchmark Hang Seng Index slipped six points, or 0.03 percent, to 23,088. The tech index fell 19 points, or 0.5 percent, to 3,834, while China Enterprises Index edged down six points, or 0.08 percent, to 7,797.
In Shanghai, the Composite Index opened six points lower, or 0.13 percent, at 3,676. The Shenzhen Component Index declined 94 points, or 0.82 percent, to 11,379, while ChiNext Index dropped 38 points, or 1.46 percent, to open at 2,596.
Tokyo's Nikkei Index started the day 172 points, or 0.27 percent, at 64,126 but later recovered slightly. Seoul's Kospi Index inched up four points, or 0.08 percent, to open at 6,017, before slipping into loss territory. The initial market declines came as Alphabet's cash burn caused its shares to tumble 10 percent in after-hours trading, eroding nearly US$400 billion from its market value. This led to a one percent decline in Nasdaq futures.
Microsoft, in contrast, exceeded expectations with more robust cash flows, driving its shares up by three percent. Meanwhile, the Federal Reserve maintained interest rates as expected, though two committee members favored an increase. Chairman Kevin Warsh expressed a more optimistic view on inflation during his press conference, prompting a rally in Treasuries. However, the main challenge surfaced from earnings reports.
Samsung Electronics reported a nearly ninefold increase in operating profit to a record high in the third quarter, fueled by strong demand for AI chips. Despite this positive news, its shares fell more than four percent. The reason behind Alphabet's decline is attributed to the impact of the AI boom on its traditional ad revenue generation.
Both Alphabet and Microsoft affirmed that their AI revenue generation remains solid, particularly through data center growth and cloud services. This has been reflected in recent reports from South Korea, where SK Hynix also showcased solid performance.
Written by urgent.news from RTHK News - Finance's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
