Investing.com - APAC shares declined in early trading on Tuesday after a mixed performance on Wall Street overnight.
The S&P/ASX 200, KOSPI 200, and Nikkei 225 dropped by 0.8%, 1.1%, and 0.5%, respectively.
In the United States, major indices fluctuated throughout the session but ended with mixed results, ahead of key corporate earnings reports, a Federal Reserve interest-rate decision, and important economic data.
The tech-heavy NASDAQ Composite rose by 0.1%, the S&P 500 also increased by 0.1%, while the Dow Jones Industrial Average dipped by 0.1%.
Investors are keenly awaiting a series of potential market-moving events that could affect the recent rotation of stock-market winners and losers, causing declines in large tech stocks and gains in smaller companies.
This week is critical, with earnings reports from Microsoft Corporation (NASDAQ:MSFT), Meta Platforms Inc (NASDAQ:META), Amazon.com Inc (NASDAQ:AMZN), and Apple Inc (NASDAQ:AAPL) scheduled over three days starting Tuesday.
Among individual stocks, McDonald's (NYSE:MCD) stood out, rising 3.7% after reporting its first quarterly decline in U.S. same-store sales since 2020, which fell nearly 1%. Despite this, the company maintained its annual guidance for new stores, capital expenditures, and operating margins.
On the economic docket, the Federal Reserve is widely expected to maintain its current interest rates on Wednesday. However, investors will closely monitor any signals about future policies. Additionally, Friday's monthly jobs report from the Labor Department could further influence rate expectations.
The bond market remained relatively quiet, as the yield on the 10-year U.S. Treasury note slightly decreased to 4.176% from 4.199% on Friday.
In the commodities market, Brent crude oil fell by 1.6% to $79.84 per barrel, while gold decreased by 0.1% to $2,382.47.
Chinese stocks ended the day lower, particularly affected by declines in pharmaceutical and semiconductor companies. The Shanghai Composite Index remained flat at 2,891.85, while the Shenzhen Composite Index fell by 0.5%, and the ChiNext Price Index dropped by 1.4%. Investors are awaiting policy signals from the July Politburo meeting. Notable declines included Wuxi AppTec, which fell by 1.4%, and Semiconductor Manufacturing International, which decreased by 6.1%. Fuyao Glass Industry dropped by 5.9% after clarified that recent visits from U.S. law enforcement agencies were not targeting the company. Poly Developments & Holdings fell by 3.7% amid subdued expectations for further property stimulus from the Politburo meeting. Banks performed well, with Bank of Hangzhou rising by 4.8% and Bank of China increasing by 2.4%.
Hong Kong's Hang Seng Index rose by 1.3% to 17,238.34, and the Hang Seng Tech Index added 0.7%. Growing expectations for a Fed rate cut fueled a broader equity rally. Among major stocks, Alibaba (NYSE:BABA) Group climbed by 4.7% following changes in merchant service fees, NIO rose by 3.1%, and CNOOC added 3.5%. Decliners included NetEase (NASDAQ:NTES), which fell by 2.3%, and SMIC, down by 2.5%.
Japan's Nikkei Stock Average rose by 2.1% to close at 38,468.63. The U.S. PCE price index data released Friday showed moderate inflation, boosting market confidence in a Fed rate cut in September. Top performers included Shin-Etsu Chemical, which was up by 8.6%, and Rakuten Group, which increased by 7.55%. Mitsubishi Motors rose by 5.3% following reports that it may join the Honda-Nissan alliance. The 10-year JGB yield decreased by 3 basis points to 1.025%.
Indian shares remained flat with the Sensex edging up by 23.12 points to 81,355.84 amid expectations for a Fed rate cut. Investors are keenly observing policy meetings from the Fed, Bank of Japan, and Bank of England this week. Among major stocks, Tata Motors rose by 0.5% and Mahindra & Mahindra added by 1.7%. Decliners included HDFC Bank, down by 0.7%, and Kotak Mahindra Bank, down by 1.0%. Titan Co. fell by 2.4%.
In Europe, UK stocks rose, with the FTSE 100 Index increasing by 0.1% to 8,292.35. JD Sports Fashion PLC was the top gainer, rising by 4.1%, followed by THG PLC, up by 3.6%, and Airtel Africa PLC, which gained by 2.9%. Energean PLC posted the largest decline, falling by 9.7%, followed by Reckitt Benckiser Group PLC, which dropped by 8.8%, and Entain PLC, which fell by 8.1%.
Elsewhere in Europe, markets closed lower, with the STOXX Europe 600 Index down by 0.2% to 511.79, Germany's DAX falling by 0.3% to 18,320.67, and France's CAC 40 slipping by 1.0% to 7,443.84.