Asian equities might experience mixed trading as global markets declined yesterday due to profit-taking and anticipation of options expiry trades. The intensified selling pressure was driven by US data showing higher-than-expected import and export prices, potentially affecting Core Personal Consumption Expenditures (PCE), the Federal Reserve’s preferred inflation measure. With rising yields, small-cap stocks in Asia might underperform.
The energy sector could attract attention as crude oil prices rose, supported by geopolitical tensions in the Middle East, particularly Israel’s increasing pressure for a Rafah operation. Friday’s calendar is light, with a focus on options expiry trades, which could keep risk assets within a tight range or under selling pressure as participants adjust their exposure following key risk events and most US earnings reports. Market participants are now awaiting the next catalysts, including the Federal Open Market Committee (FOMC) minutes and Nvidia‘s earnings next week.
