(Bloomberg) — Stocks in Asia slipped on Wednesday, tracking a US selloff, as investors weighed if the artificial intelligence rally that’s powered the bull market recently still has room to run.
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Equity benchmarks in Sydney, Tokyo and Seoul all fell, while contracts pointed to declines in Hong Kong. S&P 500 futures were little changed after the benchmark slid 0.8% on Tuesday. Treasuries were steady in Asia while oil clawed back some gains in early trading after plunging Tuesday.
A broader weakness in the semiconductor sector was highlighted on Wednesday as Asian chip stocks including SK Hynix Inc. and Samsung Electronics Co Ltd declined. The moves partly reflected a slide in Dutch giant ASML Holding NV’s shares on Tuesday after it cut its 2025 outlook. In the US, Nvidia Corp. lost 4.7%, signaling a slowdown for some of the biggest bellwethers of the industry.
“Some disappointments over the ASML new orders are surely a negative factor for today’s Asian market,” said Tomo Kinoshita, a global market strategist at Invesco Asset Management. “Now that we are in the earnings season, company announcements on earnings and outlooks are likely to become a source of volatility.”
The S&P 500 slipped to around 5,815 and the Nasdaq 100 lost 1.4%. The dollar steadied after climbing to its highest level in about two months after former President Donald Trump defended proposals to dramatically raise tariffs on foreign imports. Treasury 10-year yields declined seven basis points on Tuesday.
Investors got so bullish that it might be time to sell global stocks, according to an investor survey by Bank of America Corp. Allocations to equities surged, while bond exposure sank and cash levels in global portfolios fell to 3.9% in October from 4.2% last month, triggering a “sell signal,” strategists led by Michael Hartnett wrote.
Back in Asia, traders will be watching Chinese stocks after the housing minister announced a press briefing on Thursday that’s expected to provided more details of support measures for the property sector. A gauge of US-listed Chinese shares slumped almost 6%, while the CSI 300 index lost more than 3% on Tuesday as doubts resurfaced about Beijing’s stimulus blitz.
Elsewhere, New Zealand’s dollar and sovereign bond yields fell after the annual inflation rate declined sharply in the third quarter, returning to the central bank’s target band for the first time in more than three years.
Meanwhile, three of Southeast Asia’s biggest economies will unveil monetary policy decisions later Wednesday. Indonesia and Thailand are expected to keep rates on hold, while a cut is seen in the Philippines.
Oil Gains
Oil climbed — after falling by more than 4% on Tuesday — as Israel said it would make its own decision on how to attack Iran, keeping open the possibility that energy infrastructure may be targeted.
Crude has had a roller-coaster ride this month, with prices buffeted by tensions in the Middle East, as well as China’s efforts to revive growth in the largest importer. Traders have also been weighing the market’s outlook into next year, with the International Energy Agency flagging prospects for a global glut.
“It looks like dealers simply have their machines tied to oil futures these days,” said Christoph Rieger, head of rates and credit research at Commerzbank AG. “Whether it makes sense to adjust your long-term inflation view on the back of this is a different question.”
Key events this week:
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Morgan Stanley earnings, Wednesday
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ECB rate decision, Thursday
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US retail sales, jobless claims, industrial production, Thursday
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Fed’s Austan Goolsbee speaks, Thursday
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China GDP, Friday
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US housing starts, Friday
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Fed’s Christopher Waller, Neel Kashkari speak, Friday
Some of the main moves in markets:
Stocks
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S&P 500 futures were unchanged as of 10:12 a.m. Tokyo time
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Hang Seng futures fell 1.3%
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Nikkei 225 futures (OSE) fell 1.7%
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Japan’s Topix fell 0.7%
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Australia’s S&P/ASX 200 fell 0.3%
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Euro Stoxx 50 futures fell 0.6%
Currencies
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The Bloomberg Dollar Spot Index was little changed
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The euro was little changed at $1.0886
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The Japanese yen was little changed at 149.24 per dollar
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The offshore yuan was little changed at 7.1347 per dollar
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The Australian dollar fell 0.3% to $0.6681
Cryptocurrencies
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Bitcoin rose 0.4% to $66,778.91
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Ether rose 0.7% to $2,589.39
Bonds
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The yield on 10-year Treasuries was little changed at 4.04%
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Japan’s 10-year yield declined two basis points to 0.950%
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Australia’s 10-year yield declined five basis points to 4.21%
Commodities
This story was produced with the assistance of Bloomberg Automation.
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