Asian stocks slipped at the start of Tuesday’s session as investors prepared for voting in the US midterm elections. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.9%, while South Korean stocks dropped as much as 3.8%. Japanese markets were closed for a holiday, and S&P 500 futures edged up 0.1%.
The retreat followed a subdued session on Wall Street, where the S&P 500 lost 0.5%. Technology earnings weighed on sentiment, although data showed US manufacturing activity increased in October, supported by strong domestic demand. US Treasury yields also moved higher: the 10-year yield rose 2.1 basis points to 4.913%.
Apple shares fell 2.8% in after-hours trading after the company forecast lower gross margins for the holiday quarter, citing higher memory-chip costs. Its projected services revenue growth also came in below Wall Street expectations.
Investors are assessing the possible impact of the midterms on control of Congress. Polls favor Democrats to win the House, while the Senate race remains uncertain. Market forecasts have pointed to a possible Democratic sweep, though analysts cited in the report cautioned that prediction markets can misjudge political risks.
Oil prices were little changed in Asian trading after crude fell more than 7% on Monday. Brent was last down 0.1% at $104.72 a barrel as investors weighed prospects for US-Iran peace talks and reports of a US military strike on Iran’s Qeshm Island. The previous session’s decline followed renewed hopes for diplomacy and a possible easing of geopolitical risk to crude supplies.
Regional markets were mixed. Australian shares rose 0.1% ahead of the Reserve Bank of Australia’s rate decision, with a 25-basis-point increase to 4.85% widely expected. Taiwan’s market fell 1.3%, while Hong Kong’s Hang Seng Index gained 0.3%.
The US dollar index edged up 0.1% to 101.81, while the dollar strengthened 0.3% against the offshore yuan to 6.6645. The move followed China’s central bank announcement that it would raise the foreign-exchange deposit reserve ratio for financial institutions from 4% to 6%, effective November 15. Bitcoin rose 0.5% to $77,112.18, while ether slipped 0.1% to $2,253.59.
Sources: Investing.com News.