Asia-Pacific shares fall as dollar loses ground

Summary:

• Oil was a touch firmer and gold eased as reports flagged US and Israeli planning for fresh strikes on Iran
• The greenback eased against the euro, Swiss franc, British pound, yen and Canadian dollar, while the Australian and New Zealand dollars slipped
• New Zealand's third-quarter CPI cooled to 3.7%, shy of the 3.8% forecast, yet a near-certain RBNZ rate increase next week remains priced in
• The Bank of Korea left its benchmark rate at 3.00% as anticipated, following consecutive hikes in July and August
• Regional equities were mostly lower: the Hang Seng fell about 2.5%, the Nikkei 225 and Shanghai Composite each shed around 1%, and the Kospi declined more than the Nikkei
• Meta surpassed revenue and earnings estimates and its shares advanced, while Tesla hit three-month highs on solid margins and free cash flow

Main article:

Thursday saw a mixed picture across Asian trading: most regional equity benchmarks fell, the dollar was softer against the bulk of its major peers, and crude inched up on reporting about fresh US-Israeli military planning aimed at Iran. There was little in the way of fresh catalysts, leaving much of the day's commentary to focus on forecasts and analyst assessments.

Geopolitical risk continued to dominate the commodity backdrop. The New York Times said the US and Israeli militaries have prepared a brief but intense round of strikes against Iran that would follow the US midterm elections. The paper added, though, that President Donald Trump has repeatedly scrapped planned strikes in the current year. In a separate report, NBC News said the US is scaling back its military presence at Middle East bases and trimming embassy staff in the area, following a State Department order for non-emergency personnel to depart Saudi Arabia. Crude prices were slightly firmer, while gold declined.

On currencies, the dollar broadly softened, giving up ground to the euro, Swiss franc, British pound, yen and Canadian dollar. The Australian and New Zealand dollars went against the broader trend, easing lower.

The New Zealand dollar eased after third-quarter inflation there came in slightly below forecasts. Annual consumer price inflation cooled to 3.7% from 4.1%, below both the 3.8% consensus and the Reserve Bank of New Zealand's 3.9% projection, while prices gained 0.7% on the quarter. Inflation is still above the RBNZ's 1% to 3% target, and a near-certain rate increase at next week's policy review remains priced in. Economists expect price growth to re-accelerate in the fourth quarter as fuel costs rise.

Korea's central bank kept its benchmark rate at 3.00%, matching the forecast of every analyst in a Reuters poll, and paused after quarter-point increases in July and August. Economists see a further rise to 3.25% in November as likely, pointing to robust chip-driven exports and inflation above target.

Equity benchmarks around the region ended broadly in the red. The Nikkei 225 retreated about 1%, while South Korea's Kospi lost more ground. China's Shanghai Composite slipped roughly 1%, stretching a 10-week decline, and the Hang Seng lagged with a drop of close to 2.5%.

In corporate news, Meta Platforms posted third-quarter revenue and earnings per share that topped estimates, sending its stock higher even as a $9.9 billion legal charge weighed on operating income. Meta also laid out plans for an effective 2-for-1 stock split using a new class of non-voting shares. Tesla rose to a three-month high after beating forecasts on gross margin and free cash flow, setting a target of building roughly 5 million vehicles annually by 2030.