Key Points:
- Most Asian stocks retreat amid cautious sentiment ahead of NVIDIA earnings and Fed policy uncertainties.
- Chinese markets show resilience, extending gains on positive travel data and a larger-than-expected interest rate cut by the People’s Bank.
- Japanese and Australian indexes face downward pressure, with technology and mining stocks leading the declines.
- The tech sector is cautious ahead of NVIDIA earnings, with South Korea’s KOSPI and Nvidia suppliers experiencing losses.
Asian stocks experienced a mixed performance on Wednesday, with most markets retreating amid cautious sentiment driven by uncertainties surrounding the Federal Reserve’s stance and eagerly anticipated earnings from tech giant NVIDIA Corporation (NASDAQ: NVDA). While Chinese markets showed resilience and extended gains, Japanese and Australian indexes faced downward pressure.
Wall Street’s negative close on Tuesday spilled over into Asian markets, prompting profit-taking in the technology sector ahead of Nvidia’s quarterly earnings release. Futures pointed to a subdued opening, with S&P 500 Futures and Nasdaq 100 Futures edging lower. Investors also awaited insights from the Fed’s late-January meeting minutes regarding interest rate policies.
Chinese stocks, however, saw gains, with the Shanghai Shenzhen CSI 300 index and the Shanghai Composite rising by 1.35% and 0.97%, respectively. Official data revealing increased travel demand and spending during the Lunar New Year holiday boosted sentiment, suggesting a broader economic recovery. Hong Kong’s Hang Seng index surged by 1.8%, buoyed by positive sentiment towards Chinese markets following the People’s Bank’s larger-than-expected interest rate cut.
Japan’s Nikkei 225 index declined by 0.26%, marking its third consecutive session of losses after reaching 34-year highs earlier in the month. Technology stocks led the downturn, mirroring Nvidia’s overnight losses. Despite better-than-expected growth in Japanese exports, the market sentiment remained cautious.
Similarly, Australia’s ASX 200 slid by 0.66%, facing profit-taking after hitting record highs earlier in the year. Declines were particularly notable in heavyweight mining stocks like BHP Group Ltd (ASX: BHP), reflecting a drop in commodity prices. However, National Australia Bank (ASX: NAB) bucked the trend, rising to a six-year high on stronger quarterly profits.
The cautious atmosphere prevalent in the tech sector was evident across major Asian markets, with South Korea’s KOSPI falling by 0.17%. Heavyweight tech stocks recorded losses, with Nvidia suppliers Advantest Corp. (TYO:6857) and TSMC (TW:2330) experiencing declines of 1.98% and 0.87%, respectively. Meanwhile, futures for India’s Nifty 50 index indicated a flat open, adding to the overall mixed sentiment across Asian markets.
