Investing.com– Most Asian stocks fell on Tuesday as uncertainty over interest rates and the U.S. presidential election kept traders largely risk-averse, while Chinese markets drifted higher after an interest rate cut.
Regional markets took a weak lead-in from Wall Street, as U.S. stock benchmarks retreated from record highs as Treasury yields rose and as the earnings season loomed.
U.S. stock index futures were mildly negative in Asian trade.
Investors were now largely awaiting the U.S. presidential elections, which are just about two weeks away. Republican nominee Donald Trump was seen gaining better odds against Vice President Kamala Harris in recent polls.
Focus this week was also on a string of key U.S. earnings, with Asian earnings set to pick up in the coming weeks.
Japan’s Nikkei leads losses despite yen weakness
Japan’s Nikkei 225 was the worst performer in Asia, losing 1.7%, while the TOPIX index shed 1.1%.
Losses in Japanese shares came even as the yen touched its weakest level in nearly three months, as the currency was pressured by uncertainty over the Bank of Japan’s capacity to raise interest rates further. A weaker yen usually benefits export-oriented Japanese stocks.
Japanese general elections are set to take place later this month, while the BOJ is set to meet at the end of October.
Before that, inflation data from Tokyo is due later this week and is likely to factor into the outlook for Japanese interest rates.
Broader Asian stocks retreated. South Korea’s KOSPI lost over 1%, while Australia’s ASX 200 shed 1.4%, with the latter seeing heavy profit-taking after hitting record highs earlier in October.
