Asia shares fall on tech nerves; oil prices slip
SINGAPORE: Asia shares slipped on Tuesday while oil prices extended losses , after threats from the US for an “economic D-Day” of sanctions on Iran turned out to be a damp squib. US Treasury yields were off their recent highs following a report that the Treasury Department might tap into its cash account to finance increased debt buybacks, which could reduce the need for additional sales of…
Asia's stock markets fell on Tuesday, while oil prices declined further after US threats of sanctions on Iran failed to materialize. US Treasury yields dropped from recent highs after a report suggested the Treasury Department could use its cash account to fund more debt buybacks, potentially reducing the need for additional short-term bill sales.
The tech sector remains cautious ahead of Nvidia's earnings report on Wednesday, with analysts expecting quarterly revenue to almost double to $92 billion and full-year earnings in the range of $103 billion to $105 billion. Market analyst Fabien Yip noted that such high expectations are difficult to meet, given the company's track record.
MSCI's Asia-Pacific index outside Japan fell 0.5%, while Japan's Nikkei slipped 0.9% and South Korea's Kospi dropped 2.7%. Additionally, Alibaba's $10.2 billion share sale at a discount and Samsung Electronics' shareholder-return plan dampened tech sentiment. The Nasdaq and S&P 500 futures were slightly down, while EUROSTOXX 50 futures edged lower.
Iran's sanctions and buybacks were discussed on Monday, with the Trump administration warning countries to sever ties with Iran or face secondary sanctions. However, the Treasury Department did not impose any penalties. Analysts expressed doubt that China would comply with US pressure to halt trade with Iran, as the U.S. campaign against Iran threatens the trade truce between the U.S. and China.
Meanwhile, the US dollar gained strength against the Canadian dollar, while the euro and pound sterling showed minor gains. Market participants will await Federal Reserve Chair Kevin Warsh's speech in Jackson Hole, Wyoming, on Friday for potential clarity on U.S. interest rates, as fiscal uncertainty seems unlikely to diminish soon.
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