Highlights
- FTSE 100 expected to open 61 points lower
- Kospi tumbles 4% as tech selling deepens
- Taiwan slides more than 3%
Footsie headed lower
The blue-chip index is set to open around 61 points lower, with London set to feel the backwash from the tech sell-off. The Nasdaq fell on Monday on weaker sentiment and looks set to open lower on Tuesday. Hardest hit was Korea's Kospi, host to some of the world's largest semiconductor giants, names such as Samsung Electronics and SK Hynix. The index closed down 4%.
Asian markets slide
Asian share markets were mostly weaker on Tuesday as renewed selling in technology stocks hit South Korea and Taiwan, while investors remained cautious ahead of the US midterm elections.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell around 1.4%, reaching its lowest level since October 23, as concerns over whether the artificial intelligence-driven technology boom can sustain current valuations continued to weigh on sentiment.
South Korea was the region’s weakest major market, with the Kospi falling as much as 4.1% as investors sold semiconductor and other technology stocks.
Taiwan’s technology-heavy market dropped around 3.3%, extending its decline from an early-October record to more than 13% and putting the index into correction territory.
Australia rises after RBA hike
Australia moved against the broader regional trend, with the S&P/ASX 200 gaining around 0.3% after the Reserve Bank of Australia raised the cash rate by 25 basis points to 4.85%.
The decision, which was supported by six board members with three preferring no change, took Australian rates to their highest level since 2008 as policymakers continued to tackle persistent inflation.
The Australian dollar weakened following the decision as investors focused on the split vote and the possibility that further rate increases are not guaranteed.
Hong Kong gains as China slips
Hong Kong also traded higher, with the Hang Seng Index gaining around 0.4% to 23,494 as property and selected technology stocks supported the market.
Mainland China moved lower, with the Shanghai Composite retreating after investors gave a muted response to measures announced by regulators to support the country’s equity markets.
The measures followed a difficult October for Chinese shares, when the CSI 300 suffered its worst monthly decline in more than a decade.
Wall Street and US vote in focus
Japanese markets were closed for the Culture Day public holiday.
The regional technology sell-off followed weakness on Wall Street, where the S&P 500 lost 0.5% and the Nasdaq Composite fell 1.1% as investors questioned the scale and returns of artificial intelligence investment.
Oil prices stabilised after Monday’s sharp decline, when hopes for progress towards a diplomatic solution involving Iran reduced some of the geopolitical premium built into crude prices.
Attention now turns to the US midterm elections, with investors watching for any shift in the balance of power in Washington and the implications for economic and fiscal policy.
