APAC Equities Track US Peers Lower, Tech Hit Hardest

Asian equity markets are under significant pressure today, with major indices experiencing steep declines driven by a combination of Wall Street's sharp selloff and a stronger yen, which is dampening demand for Japanese exports. The Nikkei 225 and Topix are leading the downturn, dragged down by semiconductor stocks like Renesas and Socionext after Nvidia's extended losses following a US Justice Department subpoena. Broader concerns about the global economy, fueled by disappointing US manufacturing data and sliding oil prices, are exacerbating the risk-off sentiment across the region. Other major markets, including South Korea, Taiwan, and Australia, are also seeing substantial losses as investor focus shifts to potential economic slowdowns and higher borrowing costs.

• Japanese equities are lower across the board, consumer staples is the top performing sector with 22% of stocks trading higher, the TOPIX is down 2.75%, with banks contributing the most to the losses the TOPIX Banks Index is down 3.70%. The Nikkei 225 is trading down 3.30%, with tech stocks the largest contributors to the fall.
• Taiwan's Taiex is trading 3.60% lower today, with TSMC down 4.15% & Hon Hai down 2.70% contributing the most to the losses. Tomorrow we have Taiwan's CPI, which is expected to show a drop to 2.27% for August from 2.52% in July according to bbg consensus.
• South Korean equities are faring slightly better than Japan & Taiwan, although still struggling. Samsung is off 2.76%, SK Hynix is off 6.80%, while the KOSPI is down 2.60% and the KOSDAQ is down 3.15%. Tomorrow we have 2Q GDP with consensus at 2.3% in line with Q1.
• Australia's ASX 200 is down 2%, Mining and energy shares are among the hardest hit, reflecting worries about demand and oversupply in commodities, while Financials are tracking Asian peers lower. Earlier, Q2 GDP was close to expectations rising 0.2% q/q to be up 1% y/y, the slowest since the Covid-impacted Q3 2020 and excluding that period Q4 1991.