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investingLive Asia-Pacific market news: Asian equities sold heavily, Kospi down 7%
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South Korea’s Kospi slid about 7% to below 6,000, its lowest since July 31, while the Nikkei, ChiNext, CSI 300 and Shanghai Composite also fell</li><li>Saudi Arabia is examining plans to raise pipeline crude export capacity to 10 million bpd, and its energy minister said converting a gas line could add 1.2 million bpd within seven to eight weeks; oil edged slightly lower</li><li>US yields eased, helping gold higher and the US dollar softer; the yen firmed as Japan’s wholesale inflation stayed elevated at 6.8%, keeping a near-term BOJ hike in view</li><li>RBA minutes reiterated a hawkish bias, citing inflation risks from capacity constraints, the Iran war and the AI boom, while the NAB survey showed weak conditions alongside strong price pressures</li><li>Fed’s Hammack said she believes rates need to rise further, while BoE’s Greene warned that waiting for second-round inflation effects would be too late</li><li>JPMorgan strategists expect third-quarter earnings to support stocks as US earnings season gets under way; BOJ Governor Ueda appears in parliament from 04:00 GMT (00:00 ET)</li></ul><p dir="ltr">Asian equities</p><p dir="ltr">Asian stock markets came under heavy selling pressure on Tuesday, with technology and semiconductor shares leading the declines after a selloff in US chipmakers overnight. South Korea’s Kospi, heavily weighted toward chip stocks, extended its slide to about 7%, falling below 6,000 to its lowest level since July 31. Earlier in the session, Japan’s Nikkei was down 2.6%, while in China the tech-focused ChiNext fell 3%, the CSI 300 lost 1.3% and the Shanghai Composite slipped 1.2%.</p><p dir="ltr">The selling reflected growing unease over the durability of the AI-driven rally, together with concern that elevated oil prices linked to the Middle East conflict will keep inflation and bond yields high, weighing on expensive growth stocks.</p><p dir="ltr">Oil</p><p dir="ltr">Oil prices edged slightly lower. Saudi Arabia is examining plans to lift its pipeline crude export capacity to 10 million barrels per day, and Energy Minister Prince Abdulaziz bin Salman said converting a gas pipeline to carry crude could add 1.2 million bpd within seven to eight weeks. The plan would expand the kingdom’s ability to export through the Red Sea, bypassing the disrupted Strait of Hormuz. </p><p dir="ltr">Note that UKMTO tallied up Iranian forces reportedly managed to strike 6 commercial vessels in and near the Strait of Hormuz on Sunday alone. 6 ships struck mark the highest single-day tally since the war began.</p><p dir="ltr">Currencies, yields and gold</p><p dir="ltr">US Treasury yields eased slightly, which supported gold and left the US dollar a little softer. The yen firmed, also helped by Japanese producer price data. Japan’s wholesale prices rose 6.8% from a year earlier in September, below the 7.6% expected but still elevated as companies passed on fuel and chemical costs. Yen-based import prices jumped nearly 25%, keeping expectations of a near-term Bank of Japan rate hike alive. BOJ Governor Kazuo Ueda is scheduled to appear in parliament from 04:00 GMT (00:00 ET).</p><p dir="ltr">Australia</p><p dir="ltr">Minutes of the Reserve Bank of Australia’s September meeting, at which it raised the cash rate to 4.60%, reiterated the board’s hawkish bias. Members cited inflation risks from tight domestic capacity, the Iran war and the global AI boom, and said they would raise rates further if required. The NAB business survey for September showed weak conditions, with falls in employment and orders, alongside strong price pressures. Business confidence fell to -13.</p><p dir="ltr">Central bank speakers</p><p dir="ltr">Cleveland Fed President Beth Hammack said she believes interest rates need to rise further to restrain demand fuelled by AI investment and wealth-driven spending. She added that she would approach the 27 to 28 October meeting with an open mind on the timing of the next hike. In the UK, Bank of England policymaker Megan Greene said monetary policy is not that restrictive and argued that waiting for second-round inflation effects to appear would leave the bank acting too late. In her view, the greater risk is failing to act proactively rather than raising rates too soon.</p><p dir="ltr">Earnings ahead</p><p dir="ltr">Investors are now turning to a busy US earnings week. JPMorgan strategists said they expect third-quarter results to support equities as earnings strength broadens beyond AI. They argued that S&P 500 forecasts look more reasonable beneath the surface and that the bank’s lead indicator points to at least two positive reporting seasons.</p><p dir="ltr"></p><p dir="ltr"></p>
This article was written by Eamonn Sheridan at investinglive.com.
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