Japan’s benchmark Nikkei Stock Average on Friday morning fell as much as 1,346.7 yen, or 3.5%, from the previous day’s close as market players reacted to reports of Israel striking Iran with missiles.Nikkei stock average closed at 37,068.35 yen, down 2.66% from the previous day.

South Korea’s benchmark KOSPI closed down 1.6%, after falling as much as 3.1% in midday trading.

Samsung Electronics dropped 2.5%, while SK Hynix plunged 4.9%.The Hong Kong-based Hang Seng Index closed 0.99% lower at 16,244.14, while CSI 300, which tracks the largest names listed in Shenzhen and Shanghai, China, dropped 0.70% for the day to 3,541.66 on Friday.The downtrend began overnight with high-tech stocks in the U.S.

Selling escalated in Tokyo as investors heeded a U.S.

media report that Israeli missiles had hit a site in Iran.ABC News reported that Israel had attacked Iran, citing a senior U.S.

official.

CBS News said its sources did not disclose the location or extent of the Israeli strikes.Reuters later reported that an Iranian official said there was no missile attack against Iran.

Following earlier reports by Iranian media about explosions heard in Isfahan, the official told Reuters that the noise was a result of the activation of Iran’s air defense systems.The plunge in Asian stock markets in the morning eased by the afternoon, following initial reactions to early reports of the explosions.Nikkei Stock Average fell below the 37,000 mark during trading hours for the first time in two and a half months as value-laden semiconductor-related stocks were sold, marking the largest single-day fall this year.

Major chip-related stocks such as Tokyo Electron, Screen Holdings and Lasertec all fell temporarily by more than 7%.The stock market sell-off is led by speculative players, according to Yutaka Miura, a senior technical analyst at Mizuho Securities.

“The news of the Israeli attack on Iran apparently triggered a computer algorithm that is programmed to sell stocks and buy bonds, the yen and oil, mainly through futures,” he suggested.Institutional investors are staying on the sidelines to see how things unfold.

“They’d like to know whether the tensions will escalate to a blockade of the Strait of Hormuz, and how the U.S.

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