Hang Seng index dropped 1% in morning trade on losses in technology stocks

Most Asian stocks were mixed on Wednesday with Hong Kong shares leading losses on a decline in technology stocks, while a stellar rally in Japanese markets now appeared to be cooling.

Trading volumes remained muted on account of market holidays in China and South Korea.

Global political jitters also spurred some risk aversion, as a political crisis in France deepened, while a U.S. government shutdown stretched on. Gold hit a record high above $4,000/oz in Asian trade.

Hang Seng index was the worst performer in Asia on Wednesday, dropping 1% in morning trade on losses in technology stocks.

Tech majors Baidu Inc, Alibaba Group, and JD.com dropped between 2.7% and 5%, and were among the biggest weights on the Hang Seng. Chipmaker Semiconductor Manufacturing International Corp slid 2.6% and internet giant Tencent Holdings Ltd retreated 0.7%.

Barring tech, other sectors were resilient. Electric vehicle maker BYD Co advanced almost 2% in Hong Kong trade.

Nikkei 225 index was flat, while the TOPIX index added 0.7%. Both indexes traded below record highs hit this week, after fiscal dove Sanae Takaichi was elected leader of the Japan’s ruling Liberal Democratic Party.

Japanese stocks had surged on Takaichi’s victory, which set her up for prime ministership. The LDP leader is widely expected to dole out more fiscal spending, cut income taxes, and oppose any more interest rate hikes by the Bank of Japan (BOJ).

Broader Asian markets were lower amid weakness in tech and as global risk sentiment cooled. ASX 200 slipped 0.1%, while Straits Times index declined 0.4%.

Nifty 50 index rose slightly in morning trade, remaining above 25,000 points.