Asian stocks drop as tech retreats

KOSPI index was also a major underperformer, losing as much as 2 per cent on deep losses in chipmaking stocks

Asian stocks dropped on Thursday as technology and chipmaking stocks pulled back from recent gains.

Nikkei 225 index declined 1.9 per cent, while the TOPIX index slipped 1.4 per cent on Thursday.

Losses in stocks came after Bank of Japan Governor Kazuo Ueda said on Wednesday that the central bank must discuss the pros and cons of raising interest rates in the face of rising inflationary risks.

Speaking at a seminar, Ueda warned that inflation could overshoot targets on the energy shock from the Iran war. While he did not explicitly signal any rate hikes, his comments pointed to the increasing possibility of a rate hike when the BOJ meets later in the month.

Japanese markets were also pressured by losses in tech and chipmaking stocks, after a strong run-up in the sector pushed the Nikkei to record highs this week.

SoftBank Group Corp. was the biggest weight on the Nikkei, down almost 11 per cent.

KOSPI index was also a major underperformer, losing as much as 2 per cent on deep losses in chipmaking stocks.

Majors such as Samsung Electronics Co Ltd and SK Hynix Inc dropped between 2 per cent and 4 per cent after hitting a series of record highs as traders locked in recent profits.

ASX 200 shed 1.4 per cent, while Straits Times index declined 1.2 per cent.

Shanghai Shenzhen CSI 300 and Shanghai Composite indexes declined between 0.2 per cent and 0.4 per cent, although bigger losses were limited by an extended rally in chipmaking stocks.