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Asia-Pacific Stocks Follow Wall Street Lower

Asian markets fell broadly on Wednesday, mirroring the overnight decline on Wall Street, as investors digested weak trade data out of Japan and Beijing’s decision to keep borrowing costs steady for a third consecutive month. Technology stocks led losses across the region, while volatility in certain sectors offered rare bright spots.

Japan’s Export Slump Adds Pressure

Japan’s latest trade figures revealed exports plunged 2.6% year-on-year in July, marking the steepest contraction since early 2021. The fall was sharper than the 2.1% drop forecast by economists polled by Reuters and compared with a modest 0.5% decline in June, underscoring weakening demand from the country’s largest trading partners.

In response, Japan’s Nikkei 225 slipped 0.93%, while the Topix index lost 0.31%. Shares of SoftBank Group tumbled as much as 9.17%, extending a sell-off from the previous session after the company disclosed a $2 billion investment in Intel.

Tech Weakness Spreads Across the Region

The technology sector continued to weigh heavily on Asian markets, tracking U.S. peers that slumped overnight. South Korea’s Kospi shed 1.52%, while the Kosdaq dropped 1.77%, reflecting weakness in semiconductor and electronics stocks.

In Australia, the S&P/ASX 200 opened down 0.24%, while Taiwan’s Taiex fell more than 2%, dragged by chipmakers. Hong Kong’s Hang Seng index declined 0.71%, and mainland China’s CSI 300 slipped 0.48%, after the People’s Bank of China left its loan prime rate unchanged for August, as expected.

Pop Mart Defies Market Weakness

Against the regional downtrend, Chinese toymaker Pop Mart provided a rare upside. The company’s shares rose more than 2% in early Wednesday trade, rebounding after initial losses, following Tuesday’s earnings release showing a near-400% surge in first-half net profit.

The jump was fueled by soaring global demand for its “Labubu” dolls, a product that has gone viral worldwide and has become one of China’s most successful cultural exports in recent years.

Wall Street’s Overnight Performance

The negative tone in Asia was set by Wall Street’s performance Tuesday. The S&P 500 dropped 0.59%, closing at 6,411.37, weighed down by declines in Nvidia and other big tech names. The Nasdaq Composite sank 1.46% to 21,314.95, extending weakness in growth and technology stocks.

In contrast, the Dow Jones Industrial Average edged up 10.45 points, or 0.02%, to end at 44,922.27, even touching a fresh record high during the session.

Outlook

Investors remain cautious as Asia contends with a mix of trade headwinds, policy decisions, and global tech sector volatility. Japan’s export slump is raising questions about the resilience of the region’s manufacturing-driven economies, while China’s steady policy stance suggests limited support in the short term.

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