Asian equities gave back some recent gains on Thursday as the technology-led rally lost momentum following mixed results from several large U.S. tech firms and the Federal Reserve's move to keep its benchmark interest rate unchanged.
Trading on Wall Street finished largely subdued overnight, with the S&P 500 and the Nasdaq making only modest moves after earnings reports from some of the world’s largest technology companies. During Asian hours, U.S. stock futures edged lower, pointing to a potentially softer open for U.S. markets later in the session.
Corporate earnings and investor reactions
Meta Platforms saw its shares rally in post-market trading after it provided an upbeat revenue outlook, helping to sustain enthusiasm for AI-driven advertising opportunities. Tesla also beat expectations on its results, offering additional support for growth-oriented stocks.
By contrast, Microsoft’s results undercut some of the sector’s momentum as the company flagged rising costs associated with heavy investment in artificial intelligence, which weighed on sentiment for tech names more broadly.
Across the region, technology stocks that had climbed in recent weeks on hopes of robust AI-related demand retreated from recent peaks. South Korea’s KOSPI dropped 0.3% after earlier reaching fresh record highs in the session.
Leading Korean chipmakers Samsung Electronics and SK Hynix reported strong earnings and encouraging outlooks on Thursday, pushing their shares higher in early trade. However, both later gave up some of those gains as investors took profits amid overall market softening.
Fed pause and market expectations
The Federal Reserve’s decision to hold interest rates remained front and center for investors. The U.S. central bank held its benchmark interest rate steady on Wednesday, extending a pause that followed a series of cuts last year.
Fed Chair Jerome Powell said policymakers require greater confidence that inflation is moving sustainably toward the 2% objective before loosening policy further, while noting that economic growth has remained resilient.
Market-implied pricing from the CME FedWatch tool indicated traders expect the Fed to keep rates on hold in the near term but to deliver two more cuts later in the year.
Regional market moves
- Japan’s Nikkei 225 eased 0.2%, while the broader TOPIX declined 0.3%.
- Hong Kong’s Hang Seng slipped 0.2% after having surged more than 2.5% in the prior session.
- Mainland China’s Shanghai Shenzhen CSI 300 and the Shanghai Composite were largely muted.
- Australia’s S&P/ASX 200 fell 0.6%, and Singapore’s Straits Times Index dipped 0.1%.
- Futures for India’s Nifty 50 were down about 0.1%.
Overall, markets are responding to a mix of corporate earnings signals and central bank messaging, with technology and semiconductor names particularly sensitive to the latest developments. Investors appeared to be balancing enthusiasm for AI-driven growth against concerns about rising costs and the pace of future monetary easing.