[MARKET ANALYSIS] Asia-Pac equities mixed, US equities pare back upside following AMZN/MSFT guidance

Asia-Pacific equities are under pressure, mainly driven by a weak performance in US cash hours and geopolitical updates impacting sentiment.

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[MARKET ANALYSIS] Asia-Pac equities mixed, US equities pare back upside following AMZN/MSFT guidance

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  • Asia-Pac stocks trade with a negative bias, as weakness stateside in cash hours, earnings and recent geopolitical updates drive price action. More recently, Axios reported that US CENTCOM is to brief President Trump on new plans for potential military action, which is to include a short and powerful strike to break the nuclear issue deadlock. 
  • ASX 200 prints modest losses. IT and Tech tops the sector pile while consumer staples and mining underperforms. 
  • Nikkei 225 returns from holiday closure with losses in excess of 1%, returning to the 59,000 handle. Fujitsu weighs on the index after the Co.’s Q4 op. profit and FY forecast missed estimates. On the other hand, TDK is one of the outperformers, following FY net that rose by around 20%. 
  • KOSPI trades directionless, trading either side of the unchanged mark. Initial upside came after Samsung Electronics reported Q1 earnings that beat top- and bottom-line metrics. However, the earlier gains were erased as trade continued. LG Electronics has held onto its earlier gains, after the Co. reported Q1 net that beat expectations. 
  • Hang Seng and Shanghai Comp. trade mixed, with the Hang Seng the clear underperformer. Stronger-than-expected manufacturing PMIs fail to support the indices, while China Construction Bank prints losses following its Q2 earnings. 
  • US equity futures surged higher at the start of futures trading, driven by guidance delivered by Microsoft and Amazon after-hours. 4 of the Mag-7 reported earnings, in which all 4 (META, MSFT, AMZN, GOOGL) delivered beats in its top-line metrics, however performance was mixed. 
  • European equity futures are indicative of a softer open with the Euro Stoxx 50 future -0.5% after cash closed -0.4% on Wednesday.
Context

Although tech giants like Amazon and Microsoft provided optimistic guidance, mixed performance has led US equity futures to pare initial gains, suggesting that while there's growth optimism, geopolitical concerns and sector-specific weaknesses weigh heavily on market sentiment.

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