Regional equities retreated on Tuesday as investor caution ahead of Nvidia’s earnings report and broader technology sector concerns dragged down Asian markets.
The MSCI Asia-Pacific excluding Japan index declined 0.5%, with South Korea’s Kospi leading losses at 2.7%. Japan’s Nikkei also fell 0.9%, while U.S. stock futures showed mixed signals—Nasdaq futures were down 0.08% and S&P 500 futures were little changed. European equity futures followed a similar pattern, with the EUROSTOXX 50 futures down 0.05%.
Commodities showed divergent moves. Spot gold rose 0.5% to $4,675.51 an ounce, while Brent crude futures edged 0.1% lower to $92.08 per barrel. U.S. crude futures were up 0.1% at $85.09 per barrel, though both benchmarks had fallen more than 2% overnight before stabilizing.
Technology sector sentiment remained fragile as investors awaited Nvidia’s quarterly results, expected on Wednesday. Analysts project revenue to nearly double to around $92 billion, with full-year guidance seen in a range of $103 billion to $105 billion. However, concerns persist over the sustainability of growth tied to circular deals and potential sustainability of high growth rates in coming quarters, according to market analysts.
Broader market caution was also fueled by geopolitical developments. The Trump administration warned countries to reduce business ties with Iran or face secondary sanctions, though no penalties were immediately imposed. Meanwhile, U.S. President Donald Trump threatened to raise tariffs on Canadian automotive imports to 50% starting January 1, following the collapse of trade negotiations last week.
Currency markets reflected the cautious tone. The U.S. dollar strengthened 0.5% against the Canadian dollar to C$1.3844, while the euro traded at $1.1668, slightly below a three-month high. Sterling rose 0.06% to $1.3638.
Attention now turns to Federal Reserve Chair Kevin Warsh’s speech at the Jackson Hole economic symposium on Friday, where markets seek signals on the central bank’s policy path. Standard Chartered analysts noted that fiscal uncertainty remains elevated, but added that the Fed could ease monetary policy uncertainty by clarifying its reaction function, particularly regarding how long rates may remain on hold to achieve the 2% inflation target.
