Asian stock markets opened lower following disappointing earnings reports from U.S. tech giants.
MSCI's broadest index of Asia-Pacific — which tracks shares in the region except for Japan — went down slightly by 0.5 percent. The index was dragged down by a 1.54 percent decline in Hong Kong's Hang Seng index and a 0.95 percent drop in Chinese blue chip companies.
Indian investors also experienced a continuing decrease in the stock price of Adani Group. The Indian conglomerate has lost more than $100 billion in market value since American short-seller Hindenburg Research reported that the corporation was engaged in fraudulent management practices.
Japan's Nikkei — an index that tracks the top 225 blue chip enterprises in Japan — was one of the few gainers in Asia, increasing around 0.39 percent at one point during the trading session.
During Thursday's after-hours trading in the U.S., shares in the tech sector tumbled following disappointing earnings results from Alphabet, Apple and Amazon.
Alphabet reported a significant profit loss due to tight competition in the digital ads sector and decreased spending on marketing among companies. Apple posted its first negative revenue growth since 2019 due to low sales. Meanwhile, Amazon slashed its earnings forecast for the current quarter.
The after-hours decline followed a strong regular trading session when the S&P 500 rose by 1.5 percent and NASDAQ gained 3.3 percent. During the day, the U.S. market still maintained optimism following a smaller hike size and positive signals from the Federal Reserve.
However, S&P 500 futures fell by 0.5 percent, and NASDAQ futures lost 1.4 percent, signaling that Wall Street would likely open lower for the last day of the week.
Investors are now waiting for the U.S. payroll data due today. Deutsche Bank macro-strategist Alan Ruskin said the market would become more confident in its pricing if the report showed a softening job market.
"Not least it would provide the most important evidence to date to suggest that the market's rates pricing is more appropriate than the Fed's own more hawkish signalling," Ruskin said.
Economists predict that there were 185,000 job additions in January 2023, the lowest level in two years. They also estimate that the current unemployment rate has risen to 3.6 percent, while hourly wage inflation remains steady at 0.3 percent on a month-to-month basis.
Currently, analysts predict that the Fed will impose another 25-basis-points rate hike in March. However, most believe it will be the Fed's last rate hike in this tightening cycle. Analysts are also more optimistic about the Fed starting to reduce the rate incrementally by the end of 2023.
The European Central Bank (ECB) and Bank of England (BoE) also had their respective rate-setting meetings this week, each increasing benchmark rates by half a percentage point.
The ECB signaled that there would be at least one more rate hike before considering reevaluating its monetary tightening strategy. On the other hand, the BoE shared a more positive outlook on the economy, saying that the fight against inflation had started to show expected results.
Currency, commodity markets
In Asian currency markets, the euro fell to $1.0891 after hitting a ten-month high of $1.1033 on the previous day. The sterling also dropped to $1.2206, reaching its lowest level in two weeks. The English currency had already tumbled 1.2 percent in the previous session.
The decline in the two major currencies allowed the U.S. to regain the losses it had notched following the Fed's rate hike, with the greenback standing at the range of 101.81.
Brent crude futures gained 0.3 percent to trade at $82.41 a barrel. The U.S. West Texas Intermediate (WTI) crude also increased by 0.3 percent to $76.09 a barrel.