Asian markets down on sagging US tech earnings

A pedestrian gazes at information of Tokyo's Nikkei Stock Average during an afternoon trade session and other global markets in Tokyo.
A pedestrian gazes at information of Tokyo's Nikkei Stock Average during an afternoon trade session and other global markets in Tokyo. PHOTO: EPA

SINGAPORE - Asian markets opened lower following disappointing earnings from American tech giants Amazon and Twitter.

The Straits Times Index was down 0.87 per cent, shedding 29.26 points to 3325.5 at about 11.40am.

The Singapore market sag was in line with other Asian markets.

Sydney fell 1.3 per cent, Hong Kong shed 0.7 per cent while Tokyo was lower by 0.4 per cent.

Dragged down by technology shares, the Nasdaq lost 40 points, or 0.63 per cent.

Twitter shares were hammered after the company reported no gain in its user base in the past quarter, at 328 million monthly active users.

It reported a net loss of US$116 million (S$157.5 million) in the second quarter, slightly wider than its US$107 million loss for the same period last year.

Amazon reported that profit for the second quarter plunged 77 per cent, although its revenue grew 25 per cent from last year to US$38 billion.

The company attributed the fall to spending for the long-term future, which would include infrastructure and warehouse investments.

The world's largest online retailer has been expanding rapidly into new shopping categories and countries, including Singapore.

On Thursday, it announced its two-hour delivery service Prime Now in Singapore, as part of its expansion into South-east Asia.

In Singapore, among the market movers were Singapore Airlines and the local banks.

The airline company reported a return to profit this quarter after a surprise loss in the previous quarter. It rose 1.18 per cent, or 12 cents, to S$10.27.

While UOB grew its second quarter net-profit by 5.5 per cent, its shares were down in the morning by 2.28 per cent to S$24.04. DBS shares also edged downwards by 2.34 per cent to S$21.73.

CMC Markets analyst Margaret Yang said that investors were watching for the United States' GDP figures on Friday evening.

"The US dollar index rebounded last night as the euro retraced from its three-year high due to profit-taking activities. If tonight's GDP data shows strength in the US economy, the dollar could be supported, and set for a rebound," she said.