Asian stocks slide as high oil prices fuel inflation fears

Asian equities fell on Thursday, Oct. 8, following a retreat on Wall Street, as Brent crude held above \$100 a barrel and renewed inflation worries pushed investors away from riskier assets. Japan and South Korea led the losses, and Samsung Electronics shares swung back and forth after the chipmaker reported record profit that still came in below forecasts.economictimes+1

MSCI's Asia Pacific index slipped 0.3%. Japan's Nikkei 225 dropped 1.12% and the broader Topix fell 1.42% in early trading, according to CNBC-TV18, while South Korea's Kospi lost 0.56%. NDTV Profit reported that both benchmarks were down about 1% by mid-morning. On Wednesday, the Kospi had closed almost 2% lower and the Nikkei had ended 0.92% down. Mainland Chinese markets reopened after a holiday.tradingview+2

Oil and Iran

Brent rose about 1% to roughly \$101 a barrel after a report that the White House had asked the Pentagon to draw up options for strikes on Iran that could be carried out before the U.S. midterm elections, Bloomberg reported. A storm that shut some U.S. production also pushed prices up. Investors also weighed more Iranian attacks on ships in the Strait of Hormuz. Iran's foreign ministry spokesman Esmaeil Baghaei said Tehran and Oman had agreed on "the geographical coordinates of safe routes" through the strait, according to Iran's state news agency IRNA.theedgemarkets+2

Overnight, the S&P 500 and Nasdaq 100 each fell 0.2%, and the Philadelphia Semiconductor Index PHLX Semiconductor Index ↘ 0.49% lost 1.2%. The 10-year Treasury yield reached 5.36% during the session, its highest level since 2002. It later eased after a well-received \$39 billion auction.economictimes+1

Fed and Samsung

Minutes from the Federal Reserve's September meeting showed that all 19 officials supported raising rates by a quarter point to a range of 3.75% to 4%. It was the Fed's first hike since July 2023.theedgemarkets

"Another rate hike is probably coming this year because current policy isn't very restrictive," said David Russell at TradeStation. After the minutes came out, CME FedWatch data showed traders pricing in about an 18% chance of an October hike.finance.yahoo+1

Samsung said it expects third-quarter operating profit of a record 107.4 trillion won, almost eight times the figure a year earlier. The gain came from AI-driven demand for memory chips, but the number missed a Bloomberg forecast of 108.67 trillion won. Reuters reported, via CNA, that the stock edged down 0.3% while bond markets came under pressure from reports that big tech companies plan to raise billions in debt.channelnewsasia+1

Investors are now turning to third-quarter earnings season. Bloomberg Intelligence projects that earnings per share for S&P 500 companies will rise more than 24%.theedgemarkets