MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.08% to 566.26, not far from the one-month low of 562.43 it hit on Monday
Asian stocks were subdued on Wednesday after lacklustre earnings from U.S. tech giants Tesla and Alphabet dented sentiment, while the yen reached a six-week high ahead of a central bank meeting next week where a rate hike remains on the table.
The U.S. dollar was broadly firm, with traders watching out for an inflation number on Friday and Fed meeting next week. The BoJ is also due to meet next week, where a 10 bps hike is priced at a 44% probability.
MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.08% to 566.26, not far from the one-month low of 562.43 it hit on Monday.
Japan’s Nikkei dropped 0.23% while Taiwan financial markets are closed due to a typhoon.
Nasdaq futures dropped 0.5%, while S&P 500 futures declined 0.36% after Tesla reported its smallest profit margin in over five years. Shares of Google-parent Alphabet slid in after-hours trade even after the company beat revenue and profit targets.
The bar was set so high for Alphabet that a modest earnings beat could not push the stock higher. So, the market has no news to buy into, according to Kyle Rodda, senior financial market analyst at Capital.com.
It also speaks to concerns that tech stocks are too richly valued here. We will have to see how the other tech giants report and how the markets react, he said.
Chinese stocks were down in choppy trading, with the Shanghai Composite index 0.18% lower, while the blue-chip CSI300 index was down 0.19% after recording its largest one-day drop since mid-January on Tuesday.
Investor sentiment remained fragile in the world’s second-biggest economy despite stimulation efforts.
On the macro side, investors await the U.S. GDP data on Thursday and PCE data on Friday to gauge the expectations of interest rate reductions this year.
Markets are pricing in 62 bps of easing this year, with a cut in September priced in at 95%, the CME FedWatch tool showed.