Asian Equities Head Lower Ahead Of Central Bank Meetings

Asian equity markets are trading lower as investors await major central bank decisions, key economic data, and earnings from US megacap companies. In Japan, the Topix Index fell 0.7%, led by declines in banks and mining stocks, while the Nikkei dropped 0.75%. Seoul shares opened lower, with the KOSPI down 1% due to losses in large-cap stocks like Samsung Electronics and SK hynix. While TSMC continues to weigh on Taiwan equities as pressure from profit-taking in the AI sector continues. Meanwhile, Australia's equities are weaker driven by declines in mining and tech shares, as investors anticipate the upcoming inflation report.

• Japanese stocks fell as investors braced for key central bank decisions from the BOJ and the Fed, while also digesting mixed corporate earnings. The Topix Index dropped 0.63% led by declines in banks and mining stocks, with Mitsubishi UFJ contributing significantly by falling 1.4%, while the Nikkei is 0.65% lower. Investor caution ahead of the BOJ meeting, where potential changes to quantitative easing and interest rates are anticipated, is keeping many on the sidelines. Additionally, machinery maker Komatsu's earnings are under scrutiny, adding to the cautious sentiment in the market.
• South Korean equities opened lower, influenced by mixed performances on Wall Street and investor anticipation of the Federal Reserve's upcoming rate decision. The benchmark KOSPI is down 1% with major large-cap stocks seeing declines. Notably, Samsung dropped 0.9%, and SK hynix fell 2.7%, reflecting broader market caution, while the small-cap focused Kosdaq is down 0.75%. The market is also awaiting earnings results from major tech firms like Samsung, adding to the cautious trading environment.
• Taiwan equity markets continued to underperform on Monday, and have opened another 0.85% lower today, investors remain very cautious with the local market so heavily linked to the semiconductor space with TMSC accounting for about 60% of index moves this year. TSMC is down 1.30% this morning.
• In Australia, the ASX 200 index fell 1% driven by losses in mining and tech shares. Investors are cautious ahead of the country's quarterly inflation report due on Wednesday, which will influence the debate over the need for further interest rate hikes by the RBA. In New Zealand, the NZX 50 index bucked the regional trend, rising 0.5%, as investors remained optimistic about the local economy and corporate earnings, while A2 Milk was the largest contributor to gains after Bell Potter raised their price target on the stock 24%.
• In EM Asia markets are higher today with Malaysia's KLCI higher 0.25%, Singapore's Strait Times is 0.15% lower, Indonesia's JCI is 0.28% lower, Philippine's PSEi is 0.05% lower