Hong Kong - Shares across Asia plunged on Thursday, with technology firms in Hong Kong and Shanghai battered after the arrest of a top executive at Chinese telecoms giant Huawei that has also fuelled fears about the recent China-US trade deal.
As Donald Trump and Xi Jinping's tariffs ceasefire last weekend - which sparked a one-day rally - fades to a distant memory, investors are back in selling mood as they fret over a range of issues including the state of the world economy, oil prices and Brexit.
The chances of trade peace between the US and China took a blow on Thursday as it emerged Huawei chief financial officer Meng Wanzhou had been held in Canada and faces extradition to the United States over alleged Iran sanctions breaches by the firm.
Meng is also the daughter of company founder Ren Zhengfei, a former Chinese People's Liberation Army engineer.
The company had been investigated by US intelligence, who deemed it a national security threat.
However, the arrest drew a swift response from China, which said it "firmly opposes and strongly protests" the move, adding it had urged Canada and the US to "immediately correct the wrongdoing".
The news sent shudders through Hong Kong and Shanghai markets, where tech firms were hammered.
Hong Kong-listed ZTE, which was subject to a US banning order earlier his year over security fears before that was reduced to a massive fine, was 5.9% down. Market heavyweight Tencent was 3.6% lower and AAC Technologies was 6% off. Sunny Optical, which supplies Huawei, plunged 6.2%.
And in Shanghai, Wingtech Technology was down by its daily limit of 10%, Raisecome Technology sank 3.8% and Fujian Raynen Technology lost 3.2%.
Taipei-listed tech firms were also hurt. Taiwan Semiconductor Manufacturing Company lost 2.4% and Hong Hai Precision was 3.2% lower.
There were also losses for other tech firms in the region, with Sony down three percent in Tokyo and Samsung almost 2% lower. The sector was already under pressure from concerns about future growth and following a surge in recent years.
"This headline is quite significant as the US government is attempting to persuade allies to stop using Huawei equipment due to security fears," said Stephen Innes, head of Asia-Pacific trade at OANDA.
"Recall that over 100 Chinese companies traded limit down (last month) when news broke the US urged allies to blacklist Huawei?"
Broader markets, which have also been hit by worries that the US economy is showing signs of slowing, were well down.
Hong Kong shed 2.6% by lunch while Shanghai lost 1.3% and Tokyo slipped 2.5%. Taipei was 2.2% off, while Manila and Jakarta also dived.
Sydney fell 0.5%, while Singapore and Seoul each gave up 1.3%.
"This is what you call playing hard ball," said Michael Every, head of Asia financial markets research at Rabobank in Hong Kong.
"China is already asking for her release, as can be expected, but if the charges are serious, don't expect the US to blink."
On foreign exchanges the flight to safe-haven assets sent high-yielding and emerging market currencies sharply lower, with the Australian dollar and South African rand 1% off, South Korea's won 0.5% lower and the Indonesian rupiah 0.7% lower.
The greenback was well down against the yen, which is a go-to unit in times of turmoil.
The pound is struggling as Britain lurches towards a no-deal Brexit with Prime Minister Theresa May facing defeat in her attempts to push through parliament a controversial agreement with the EU.
Oil prices extended losses ahead of the weekend's meeting of OPEC and non-OPEC production giants, with investors unsure about how much and for how long they plan to reduce output.
The commodity has come under selling pressure, having soared on Monday and Tuesday, owing to uncertainty about the reduction plans while Trump has called on OPEC to lift output to keep prices low..
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