Asian stocks tumbled at the start of a new week as fears of a deeper US economic slowdown and rising tensions in the Middle East prompted investors to shun risk assets.
Monday’s rout brought the regional equity benchmark a whisker away from erasing its gain for the year, while its slide from a July 11 peak approached the 10 percent mark—which would signal a technical correction. This “feels more like a global equities risk off in general and the profit taking is being done in sectors or geographies that have done well,” said Vey-Sern Ling, managing director at Union Bancaire Privee.
Taiwan Semiconductor Manufacturing Co., the largest stock on the MSCI Asia gauge by market value, lost more than 7 percent, dragging the Taiex lower with it. South Korea’s benchmark Kospi Index slid over 5% as the rotation away from tech-heavy markets intensified. The Kospi also took its losses from a July 11 peak to more than 10 percent to head for a technical correction, with data showing that foreign investors led Monday’s selloff.