Asia Market Wrap - Asian Stocks Continue to Slide
Most Read: NVIDIA (NVDA) Q3 2025 Earnings Preview: Navigating the AI Stress Test
Global markets, especially stocks and Bitcoin, became weaker because traders are worried and reducing their risks. This cautious move comes right before two very important events: the release of Nvidia's company earnings report and the crucial US employment report.
In Asia, stock markets hit their lowest points in a month. The biggest drops were seen in Japan (whose Nikkei index fell 3%) and South Korea (whose KOSPI index lost 3.3%), both known for their big technology sectors. Other major markets like Australia (down nearly 2%) and Hong Kong (down 1.67%) also fell significantly.
The general drop in Asian markets followed a large sell-off in the US stock market (Wall Street) the night before, as investors prepared for many new economic reports to be released. A group of Japanese stocks related to Artificial Intelligence (AI) saw a big one-day drop of 4.7% on Tuesday.
These same AI stocks had previously grown by a massive 130% from the start of the year until October but have now fallen about 15% since the end of October.
European Session - Banking Stocks Drag
European stock markets dropped to their lowest point in a week on Monday. This decline mirrored a global trend where investors are avoiding risk due to two main concerns: the technology sector being possibly overpriced (a potential "AI bubble") and the growing belief that the US Federal Reserve will not cut interest rates soon.
The main European stock index, the STOXX 600, fell 1.1%, and major national markets like Germany and France also dropped over 1.2% each. Banking stocks in Europe were the biggest reason for this overall decline, falling more than 2%. Investor mood is delicate globally, especially with high expectations for Nvidia's earnings report coming on Wednesday, which is increasing concerns about an AI-related stock bubble.
In Europe, companies that make AI-related equipment, such as Siemens Energy and Schneider Electric, saw their stocks fall, and ABB's shares dropped 4% after its growth outlook disappointed investors.
Additionally, traders are being careful ahead of the important US jobs report due on Thursday. Although some data suggests the job market is weakening, comments from most Federal Reserve officials suggest they are less likely to cut interest rates in December. The one positive note was the Swiss drug company Roche, whose stock jumped nearly 6% after sharing good results from a late-stage trial for its breast cancer medicine.
On the FX front, The Japanese yen got stronger against the dollar in Asian trading, bouncing back from its weakest point in over nine months. This happened because traders became less confident that the US Federal Reserve would cut interest rates next month, leading to a general move away from riskier investments across various markets.
The US dollar weakened 0.3% against the yen, dropping to 154.885, as traders sought safety in the yen while stocks, gold, and Bitcoin were being sold off.
The overall dollar index, which measures the dollar against other major currencies, was 0.1% weaker at 99.448. Meanwhile, the euro gained 0.1% against the dollar, ending a three-day slide. The Australian dollar fell slightly (0.2%) to 0.64785 after meeting minutes showed that the Reserve Bank of Australia (RBA) is questioning if its current interest rate of 3.6% is still strict enough, especially noting a rise in loans to property investors.
The British pound remained steady at 1.3157, and the New Zealand dollar weakened slightly (0.1%) to 0.56475
Currency Power Balance
Source: OANDA Labs
Oil prices dropped by almost 1% on Tuesday. This decline occurred because concerns about global oil supply were reduced after loading operations resumed at a key Russian export port. These operations had been briefly stopped following a strike involving a Ukrainian drone and missile.
In the background, traders are still trying to understand how Western penalties (sanctions) will ultimately affect the amount of Russian oil reaching the market. Specifically, Brent crude oil futures fell by 56 cents (0.9%) to $63.64 a barrel, and US West Texas Intermediate (WTI) crude futures dropped by 54 cents (0.9%) to $59.37 a barrel.
Gold prices dropped to their lowest point in over a week on Tuesday. The main reason for this decline was that traders are becoming less confident that the US Federal Reserve will cut interest rates next month, which reduces the appeal of gold.
This price movement occurred as traders awaited the release of delayed U.S. economic reports later in the week. Specifically, the price of spot gold fell by 0.3% to 4,033.29/oz.
Read More:
- USD/JPY: Potential minor top at 155.30, USD at risk of bearish reversal towards 154.20/153.65
- Gold (XAU/USD): 9% dead cat bounce rally at risk of reversal, watch US$4,036 downside trigger
Economic Calendar and Final Thoughts
The European session will be quiet one in terms of data releases but we do have a host of Central Bank speakers from the ECB and BoE.
The US session will bring some data releases but markets are more focused on the FOMC minutes on Wednesday as well as the NVIDIA earnings release. We have also heard from the BLS that September’s payrolls will be released on Thursday at 08:30 AM Washington time. That should limit the FX impact of tomorrow’s FOMC minutes and could prove as pivotal for macro as Nvidia’s earnings are for equities.
Chart of the Day - FTSE 100 Index
From a technical standpoint, the FTSE 100 has broken below the crucial 200-day MA.
However, the most recent four-hour candle closed as a hammer candlestick hinting at a potential recovery.
Despite this price remains below the 200-day MA, with a close above the 9610 level needed to give me confidence that further upside may materialize.
Immediate resistance rests at 9661 and 9700 before the 100-day MA at 9743 comes into focus.
Immediate support rests at 9575, 9545 before the 9500 handle comes into focus.
FTSE 100 Index Daily Chart, November 18, 2025
