Asian Stocks Retreat Ahead of U.S. Midterm Voting, and Oil Steadies After Its Tumble
Asia-Pacific shares fell 0.9 percent at the start of Tuesday trade, Korean shares dropped as much as 3.8 percent, and Brent crude held near $104.72 as investors waited for Americans to decide control of Congress, Reuters reported.
Stocks edged lower at the start of Asian trade on Tuesday and oil prices stabilised after the previous session's tumble, with investors on edge ahead of the start of voting in the U.S. midterm elections, Reuters reported from Singapore. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.9 percent, led by a decline of as much as 3.8 percent in Korean shares, while S&P 500 e-mini futures edged up 0.1 percent and Japanese markets were closed for a holiday.
Overnight on Wall Street, the S&P 500 slipped 0.5 percent as technology earnings weighed on confidence, even as data showed U.S. manufacturing activity picked up in October amid strong domestic demand, Reuters reported. Apple shares extended losses, falling 2.8 percent in after-hours trading after the iPhone maker forecast lower gross margins for the crucial holiday quarter, citing rising memory-chip costs, and projected services revenue growth well short of Wall Street expectations. The yield on the U.S. 10-year Treasury bond was up 2.1 basis points at 4.913 percent.
On the election itself, opinion polls favor Democrats to win the House while the Senate remains too close to call, Reuters reported, and prediction-market sites Polymarket and Kalshi currently assign around a 75 percent probability that Democrats will control the Senate. MUFG analysts cautioned in a note reported by Reuters that prediction markets imply the greatest likelihood of a Democratic sweep, but that polling margins remain broadly comparable to the 2018 midterms, when Democrats won the House decisively and Republicans held the Senate — and that Brazil's recent election surprise is a reminder that prediction markets can misprice political tail risks.
In crude, Brent was last 0.1 percent lower at $104.72 as trading resumed in Asia and investors weighed the state of peace talks between the U.S. and Iran, Reuters reported. Crude fell more than 7 percent on Monday as talks between Iranian and Qatari officials lifted hopes for an end to the U.S.-Israeli war with Iran. Elsewhere in the region, Taiwanese shares fell 1.3 percent, Hong Kong's Hang Seng rose 0.3 percent and Australian shares rose 0.1 percent, the U.S. dollar index edged up 0.1 percent to 101.81, Bitcoin crawled 0.5 percent higher to $77,112.18, and cryptocurrencies remained choppy after last week's Binance hack, with customers withdrawing a net $4.72 billion, according to Reuters.
