Asian markets were volatile on Thursday, as concerns about Nvidia’s China business pressured regional suppliers, even while Chinese chipmakers surged.
MSCI’s broadest index of Asia-Pacific shares outside Japan swung between gains and losses, last down 0.4%. U.S. equity futures also slipped after Nvidia shares fell 3.1% in after-hours trading, dragging sentiment. “After such a strong run, investor exposure was stretched, leaving little margin for disappointment,” said Charu Chanana, chief investment strategist at Saxo in Singapore. She added that some spillover into Asian markets was likely, especially among chipmakers in Korea and Taiwan.
In early European trade, pan-regional futures were flat, with Germany’s DAX futures up 0.1% and the FTSE 100 also rising 0.1%. The euro held steady at $1.1642, maintaining a three-week winning streak that lifted monthly gains to 2%.
Investor focus on Nvidia centered on its China sales outlook, caught in the ongoing trade war between Washington and Beijing. Goldman Sachs noted Nvidia did not ship any H20 products to China in the last quarter. Adding to concerns, Nvidia reported data center revenues of $41.1 billion, slightly below forecasts of $41.3 billion. This pressured regional tech stocks, with TSMC sliding 2.5% and Samsung Electronics down 1%. By contrast, Chinese rivals soared — SMIC jumped 9.3% and Cambricon Technologies rose 8.2%, pushing the STAR 50 Index up by as much as 5%.
Elsewhere in Asia, Japanese stocks fluctuated before closing higher, with the Nikkei 225 up 0.7%, after reports that trade negotiator Ryosei Akazawa canceled a planned U.S. trip. Shares of Mitsubishi Corp gained 3.2% after Berkshire Hathaway increased its stake. Korean equities rose 0.4% after the Bank of Korea held rates at 2.5%. Hong Kong’s Hang Seng Index dropped 0.9%, dragged by a sharp 11.4% fall in Meituan following weak quarterly profits.
In currency markets, the U.S. dollar weakened as traders raised bets on a Fed rate cut next month. Market odds for a 25-basis-point cut at the September 17 Fed meeting rose to 88.7%, up from 61.9% a month earlier, according to CME FedWatch. The dollar fell 0.2% to 147.135 yen.
The pressure on the Fed intensified as President Donald Trump attempted to fire Fed Governor Lisa Cook, raising concerns over the central bank’s independence. Cook, through her lawyer, confirmed she will sue to contest the move. Trump has also pushed for steep rate cuts and threatened to fire Chair Jerome Powell, although he has recently softened his stance.
Bond yields reflected this outlook, with the 10-year U.S. Treasury yield slipping to 4.2227% from 4.238%. In commodities, Brent crude fell 0.8% to $67.49 per barrel, while spot gold edged down 0.2% to $3,391.60 per ounce.
