Global Markets: Asian stocks sink to 3-month low on tech angst, Gulf tensions

SK hynix

Today 07:33

SpaceX, Meta's earnings card fail to address AI concerns 
Asian tech leaders slide across the board 
Oil prices stay elevated amid Gulf uncertainties 
Update to Asia afternoon trading
By Jiaxing Li
HONG KONG, Oct 22 (Reuters) - Asian stocks retreated on Thursday as technology shares led a broad selloff, with Wall Street earnings failing to quell worries over soaring AI investment costs, while escalating Gulf tensions boosted oil and weighed on risk sentiment.
MSCI's broadest index of Asia-Pacific shares outside Japan .MISX00000PUS slumped 1.8% to the lowest level in nearly three months and was on track for a fourth straight week of decline.
Japan's Nikkei .N225 gave up earlier gains to trade 2% lower, Korean shares .KS11 tumbled more than 4%, while China's blue-chip CSI300 .CSI300 fell 2%, pushing it to the brink of a technical bear market. Hong Kong's Hang Seng Index .HSI lost more than 3%. 

        Tech leaders in the region were among the biggest losers, with Japan's Tokyo Electron 8035.T down more than 6%. Korea's SK Hynix 000660.KS and Samsung 000660.KS were down 5.7% and 4.2%, respectively, while Alibaba 9988.HK tumbled 6.5% in Hong Kong.

        In early European trading, the pan-region Euro Stoxx 50 futures STXEc1 declined 0.9%. U.S. stock futures, the S&P 500 e-minis ESc1, dropped 0.8%.   
Overnight, the tech-heavy Nasdaq led Wall Street to a slightly higher close. Space X SPCX.O posted its first profit as a public company and Meta META.O reported third-quarter revenue that beat expectations, easing fears over the payoff from massive AI spending.
The optimism quickly evaporated in Asia, however, as investors refocused on AI costs, with Meta's plan to issue non-voting Class C stock reviving concerns over mounting capital commitments.
"There's a lot of noise out there at the moment and investors are still digesting this morning's results," said Kyle Rodda, senior financial market analyst at Capital.com. 
"Also, we're really only at the start of the meaty part of earnings season, which is coming at the same time that investors are tackling the uncertainty from an upcoming Fed decision, geopolitical risks, and US mid-terms."
Those geopolitical concerns were reflected in oil markets. Brent crude LCOc1 rose more than 2% to $111.03 a barrel, near a five-month high, after more Houthi attacks in Saudi Arabia raised the risk of wider conflict and supply disruptions in the Middle East.
A flight to safety pushed benchmark U.S. Treasury yields lower, with the 10-year yield US10YT=RR falling nearly 6 basis points to 5.0857% and the 30-year yield US30YT=RR touching a one-week low of 5.3850%.
French government bonds also remained under pressure after the 10-year yield FR10YT=RR climbed above 5%, as investors looked for signs the government can contain social unrest and bring spending under control.

        In currencies, the dollar index =USD, which tracks the greenback against a basket of currencies of other major trading partners, dipped to 101.57. The euro EUR= was little changed at $1.1242. 
The yen JPY= ticked up to 157.55 after Deputy Bank of Japan Governor Ryozo Himino signalled his readiness to raise borrowing costs. The Korean won KRW= was muted at 1324, after the Bank of Korea left its benchmark interest rate unchanged at 3.00% on Thursday.
Gold XAU= eased to $4,067.5 per ounce. GOL/
Bitcoin BTC= fell 2.2% to $82,771.05, while ether ETH= was also 2.2% lower at $2,436.3. 
     

 (Reporting by Jiaxing Li in Hong Kong; Editing by Kate Mayberry and Shri Navaratnam)
 ((jiaxing.li@thomsonreuters.com))