HONG KONG -- Asian stocks opened lower on Friday after Wall Street tumbled the most in nearly three months as the tech rally lost steam.
Japan's Nikkei Stock Average and South Korea's Kospi were 1.3% lower in early trade while Australia's S&P/ASX200 ceded 2.4%. China's CSI 300, an index of the largest stocks traded in Shanghai and Shenzhen, as well as Hong Kong's Hang Seng Index lost more than 1.5%.
The Nasdaq composite and S&P 500 on Thursday recorded their biggest single-day declines since June 11. Their futures contracts slipped further on Friday when U.S. jobs data for August is also due.
"The elastic band finally snapped and the long-awaited equity sell-off that many had anticipated finally kicked," said Chris Weston, a Melbourne-based head of research at brokerage Pepperstone.
Global equity investors are pausing to monitor the progress of coronavirus vaccine candidates under trial and stimulus measures to support the economy after most major markets scaled all-time highs. Technology stocks, in particular, have raced ahead of other sectors, pushing investors to cash out.
Shares in Tesla have lost nearly a fifth of their value in the past three sessions after its largest outside shareholder, Baillie Gifford, cut holdings and the electric vehicle maker announced share sales.
Shares in Apple, whose market capitalization had surged past $2 trillion, fell 8% on Thursday.
"When it comes to the tech sector and the other online giants that have gained so much in the last few months, there could be profit taking as we head toward the U.S. presidential election in November," said Kerry Craig, a global market strategist at J.P. Morgan Asset Management.
"News that a vaccine could be available to front line health workers sooner than expected could be a reason to expect a rotation toward more cyclical sectors of the U.S. market, and energy and financials were relative outperformers yesterday," Craig said. "However, the second wave in Europe reminds us that the battle is far from over until a vaccine is widely available."
Early on Friday, Asian stocks showed far more resilience with traders saying investors will await more clarity on the economy as well as on fiscal and stimulus measures before unwinding. The head of the Chicago Federal Reserve, Charles Evans, on Thursday called on the U.S. Congress to deliver more fiscal aid and indicated monetary policy would be eased further and interest rates kept at ultralow levels to help the economy recover its pre-pandemic strength.
In Japan, SoftBank Corp. lost 2% while Sony and Panasonic slipped 1%. Toyota Motor was up 0.6%.
In Hong Kong, Tencent shares lost 3.5% while Alibaba tumbled 6% in early trade. HSBC Holdings was lower by 1.8%. In China, liquor maker Kweichow Moutai slipped 1.3%, PingAn Insurance dropped 1% and electrical appliances maker Midea fell 2.4%.
U.S. Treasurys and the dollar were steady. Oil declined 0.6% while gold nudged up 0.3%.