Overnight on Wall Street, the technology-heavy Nasdaq Composite tumbled 2 percent after Cisco Systems posted quarterly adjusted gross margin below estimates as costs of memory chips surged. That drove its shares down 12 percent and wiped out about US$40 billion of its market cap.

The selloff spilled over into tech giants like Apple, which tumbled 5 percent in the biggest daily drop since April last year when US President Donald Trump's sweeping “Liberation Day” tariffs spooked markets. Transportation companies also got caught up in worries about AI disruption.

“The prevailing tone in markets is a rotation toward more defensive areas of the equity market and companies with steady, less cyclical and more predictable earnings,” said Chris Weston, head of research at Pepperstone.

“It is clear that investors are viewing developments in AI and AGI through a new lens, attempting to price a future that feels more uncertain and structurally disruptive than before.”

On Friday, MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.6 percent, trimming this week's gain to 4.1 percent. Japan's Nikkei skidded 0.9 percent, but was still up 5.3 percent for the week.

Prospects

Every Monday

With exclusive interviews and in-depth coverage of the region's most pressing business issues, "Prospects" is the go-to source for staying ahead of the curve in Indonesia's rapidly evolving business landscape.

View More Newsletter

By registering, you agree with The Jakarta Post's Privacy Policy

Sign Up

Thank You

for signing up our newsletter!

Please check your email for your newsletter subscription.

View More Newsletter

Chinese blue chips dropped 0.6 percent while Hong Kong's Hang Seng index slid 1.5 percent.

Both Nasdaq futures and S&P 500 futures were up 0.1 percent, while Euro STOXX 50 futures climbed 0.2 percent.

Precious metals attempted to recover from heavy losses. Gold rose 1 percent to $4,972 an ounce, after losing over 3 percent on Thursday, while silver climbed 2 percent to $76.8 an ounce, having plunged 10 percent overnight.

Traders await US inflation test

The broad selloff in stocks pushed buyers toward US Treasuries, with the yield on the benchmark 10-year note tumbling 7 basis points overnight, its biggest drop since Oct. 10. It was steady in early Friday trade at 4.1154 percent.

A very strong auction of the 30-year bonds helped drive longer-term yields lower. Thirty-year yields slumped 8.5 basis points overnight to 4.728 percent, its lowest since Dec. 3.

Fed funds futures also rallied to reverse most of the losses after the payrolls data that led markets to pare back the chance of a rate cut in June. A move in June is now back in play, with the chance priced at 70 percent, and a total easing of 60 basis points is expected this year.

Much attention will be on the US inflation data due later in the day. Forecasts are centered on a monthly rise of 0.3 percent in the core measure, which is enough to see the annual rate slow to 2.5 percent from 2.7 percent previously.

“Even an in-line result would reflect a meaningful deceleration from December and that could bolster animal spirits and spark energy back into the cyclical trade,” said Jose Torres, a senior economist at Interactive Brokers.

In the currency markets, the risk-sensitive Australian and New Zealand dollars took a step back. The Aussie was steady at $0.7089, having lost 0.5 percent overnight, while the kiwi traded at $0.6033, after slipping 0.3 percent overnight.

Oil prices were flat after a sharp 3 percent slide overnight on falling demand, easing fears of renewed Middle East conflict and an expected increase in supply.

US West Texas Intermediate crude tacked on 0.2 percent to $62.95 per barrel, while Brent crude futures edged up 0.2 percent to $67.65 per barrel.

Popular

Poverty at record low as govt seeks to redefine threshold

Markets don’t lie

Aceh still suffers from blackouts, evacuees lack clean water supplies