Tech-heavy bourses including KOSPI and Hang Seng pulled back on Thursday, as investors pivoted out of the sector and into more economically sensitive spaces

Most Asian stocks dropped on Thursday as investors pivoted out of heavyweight technology stocks amid growing questions over steep valuations, with focus turning to a host of key earnings from Hong Kong.

Tech-heavy bourses including KOSPI and Hang Seng pulled back on Thursday, as investors pivoted out of the sector and into more economically sensitive spaces.

Nikkei 225 also traded flat on this trend, while the TOPIX, which has a greater weightage of non-tech stocks, gained 0.6%.

Japanese producer inflation read slightly higher than expected for October, keeping markets on edge over hawkish signals for the Bank of Japan.

The rotation out of tech was driven chiefly by emerging concerns over lofty valuations in the sector, fuelled by hype over artificial intelligence.

Mainland Chinese indexes, which also have relatively lower tech weightages, advanced on Thursday, with the Shanghai Shenzhen CSI 300 rising 0.7%, while the Shanghai Composite advanced 0.3%.

Hang Seng index declined 0.4% on Thursday, pressured by weakness in tech.

Focus was chiefly on upcoming earnings from some of China’s biggest internet and technology firms, which are due on Thursday and Friday.

Alibaba Group, Tencent Holdings Ltd, and JD.com are set to report their September quarter earnings on Thursday, while Semiconductor Manufacturing International Corp, China’s biggest chipmaker, will report on Friday.

The figures will be closely watched for more cues on China’s AI plans, while prints from JD and Alibaba will also offer insight into consumer spending, given their e-commerce dominance.

ASX 200 index was the worst performer in Asia on Thursday, slipping 1.1% after stronger-than-expected employment data dented bets on more interest rate cuts by the Reserve Bank.

Employment growth in the country was more than twice as expected in October, government data showed, while unemployment dropped more than expected.

The figure raised concerns that strength in the labour market will dissuade the RBA from cutting interest rates further, especially given that inflation also turned sticky in recent months.

The RBA has repeatedly signalled that inflation and employment are its biggest considerations for cutting rates. With both factors now appearing strong, the central bank has less impetus to cut rates further.

ANZ analysts said they still expect the RBA to keep rates on hold in December, with only one more cut expected in early-2026.

Among broader Asian markets, Singapore’s Straits Times index dropped slightly.