Asian Equities Lower Ahead Of Corporate Earnings

Asian markets traded lower on Wednesday, reflecting cautious sentiment as investors brace for a wave of earnings reports that could set the tone for risk assets. Hong Kong tech stocks led the declines, falling for the second consecutive day, influenced by weak sentiment following disappointing results from PDD Holdings. The anticipation of Nvidia's earnings report added to the uncertainty, with high expectations for the AI-driven stock raising concerns about potential disappointment. Meanwhile, rising costs and inflationary pressures remain a concern, particularly in the Australian market, where inflation data has bolstered the case against a Reserve Bank interest rate cut.

• Japanese equities are mostly lower today, with the Topix down 0.10%, Banks however are trading slightly better with the Topix Banks Index up 0.30%, while the Nikkei is down 0.15%. Investors are awaiting Nvidia’s earnings report, which is expected to significantly impact market sentiment. Shares in Seven & i Holdings Co. dropped 4% following news of the company seeking government protection, potentially complicating the buyout proposal.
• South Korean equities were higher on the open although we have since given back all gains with the KOSPI now down 0.50%. Investors have been better sellers of local stocks today with most outflows coming from tech stocks. The small-cap focused KOSDAQ is currently unchanged for the day.
• Taiwanese equities are slightly lower although TSMC & Hon Hai are both largely unchanged for the session. There has been very few headlines out of the region recently, while foreign investors have again started to sell local stocks with the past two session seeing a total outflow of $555m. The Taiex Index is currently trading down 0.30% today and is right on the 20 & 50-day EMAs.
• In Australia equities are lower, following higher-than-expected Australian inflation data, which increased concerns about potential interest rate hikes by the RBA, with the OIS market now pricing in 24bps of cuts by the December meeting, down from 27.5bps on Tuesday. The ASX200 is currently 0.56% lower. New Zealand equities are also lower today with the NZX50 down 0.30%.
• In Asia EM equities today, Indonesian's JCI is up 0.20%, Malaysia's KLCI is 1% higher, Philippines PSEi is 0.25% higher, although it should be noted that FX trading has been closed due to monsoon rains and could be also impacting equity trading, while Singapore's Straits Times is down 0.50%.