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(Bloomberg) — Asian equities fell in the wake of big tech declines on Wall Street as traders geared up for a raft of policy decisions this week from the US, UK and Japan.
Tech shares across the region retreated, with a gauge of the sector’s stocks set to post its biggest decline in almost a month. The drop mirrored losses in Nvidia Corp. and Meta Platforms Inc., which both fell more than 3.5% on Friday.
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Distressed Chinese property developer Country Garden Holdings Co. remained in focus as it faces more tests on Monday, including a vote to extend payment on a local bond. Shares in Hong Kong fell and China’s CSI 300 Index briefly touched its lowest level this year before erasing losses as traders drew support from data last week which pointed to signs of stabilization.
“Even under such a strong stimulus, we are still seeing the property prices falling,” Hebe Chen, an analyst at IG Markets Ltd., said on Bloomberg Television. “That’s a dangerous sign for me.”
Japan’s markets are shut for a holiday, with the nation’s central bank due to meet later this week. Contracts for US shares edged higher.
Also in focus is Saudi Energy Minister Prince Abdulaziz bin Salman, who is due to address an industry conference on the kingdom’s crude policy and outlook on Monday. Oil advanced for a third day, with Brent pushing toward $95 per barrel as OPEC+ supply cuts tightened the market.
There was no cash trading of Treasuries in Asian hours Monday with Japan shut for a holiday. Treasury futures slipped after yields rose Friday, with the rate-sensitive two-year rate closing above 5%. The greenback weakened against most of its G-10 peers while the Australian dollar and yen traded within narrow ranges.
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Higher for Longer
US inflation expectations fell to the lowest in more than two years as consumers grew more optimistic about the economic outlook, data showed Friday. A measure of New York state factory activity unexpectedly expanded amid new orders.
A resilient US economy will prompt the Fed to pencil in one more interest-rate hike this year and stay at the peak level next year for longer than previously expected, according to economists surveyed by Bloomberg News.
“The Fed will be sufficiently hawkish so that markets don’t think it is done hiking,” said Win Thin, global head of currency strategy at Brown Brothers Harriman & Co., referring to this week’s US policy decision. Inflation continues to be elevated, the economy is still growing above trend and the labor market remains extremely tight so “simply put, current conditions warrant further tightening, period,” he said.
Meanwhile, piles of derivatives contracts tied to stocks, index options and futures expired Friday — compelling traders to roll over their existing positions or to start new ones. This time, it coincided with the rebalancing of benchmark indexes including the S&P 500, another catalyst for more share transactions.
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Elsewhere, Chevron Corp. resumed full production from a liquefied natural gas export facility in Australia that suffered a fault last week, even as union members continued strikes at the site.
Key events this week:
- Apple expected to release the iPhone’s latest operating system, iOS 17, Monday
- Reserve Bank of Australia issues minutes of September’s policy meeting, Tuesday
- OECD releases interim economic outlook report on the global economy, Tuesday
- Eurozone CPI, Tuesday
- Bloomberg Future of Finance Conference in Frankfurt, with speakers to include German Finance Minister Christian Lindner, Tuesday
- ECB Executive Board member Frank Elderson speaks, Tuesday
- Bank of Canada Deputy Governor Sharon Kozicki speaks, Tuesday
- Japan trade, Wednesday
- China loan prime rates, Wednesday
- UK CPI, Wednesday
- Federal Reserve policy meeting, followed by Chair Jerome Powell’s news conference, Wednesday
- Bank of Canada issues summary of September’s policy meeting, Wednesday
- Bank of England policy meeting, Thursday
- ECB Executive Board member Isabel Schnabel chairs panel, Thursday
- ECB chief economist Philip Lane speaks, Thursday
- Japan CPI, PMIs, Friday
- Bank of Japan rate decision, Friday
- Australia PMIs, Friday
- China’s Bund Summit, Friday
- Eurozone S&P Global Eurozone PMIs, Friday
- UK S&P Global / CIPS UK Manufacturing PMI, Friday
- ECB Vice President Luis de Guindos speaks, Friday
- US S&P Global Manufacturing PMI, Friday
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Some of the main moves in markets:
Stocks
- S&P 500 futures rose 0.2% as of 11:53 a.m. Tokyo time. The S&P 500 fell 1.2% on Friday
- Nasdaq 100 futures rose 0.1%. The Nasdaq 100 fell 1.8%
- Australia’s S&P/ASX 200 fell 0.6%
- Hong Kong’s Hang Seng fell 0.9%
- The Shanghai Composite was little changed
Currencies
- The Bloomberg Dollar Spot Index was little changed
- The euro was little changed at $1.0666
- The Japanese yen was little changed at 147.73 per dollar
- The offshore yuan fell 0.1% to 7.2888 per dollar
- The Australian dollar rose 0.1% to $0.6441
Cryptocurrencies
- Bitcoin rose 0.9% to $26,676.46
- Ether rose 0.8% to $1,630.19
Bonds
- Australia’s 10-year yield advanced 11 basis points to 4.21%
Commodities
- West Texas Intermediate crude rose 0.6% to $91.30 a barrel
- Spot gold rose 0.2% to $1,928.67 an ounce
This story was produced with the assistance of Bloomberg Automation.
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