Asian equities fell on Tuesday October 13, as fresh selling in artificial intelligence stocks unsettled investors before the US earnings season. The MSCI Asia Pacific Index slid 0.9% and headed for its weakest close since mid-August, with South Korean and Japanese shares leading the retreat.
South Korea took the heaviest hit, as Kospi, which traders treat as a barometer for the AI trade, tumbled 5.24% and moved towards its lowest close since July. Chip heavyweights SK Hynix and Samsung Electronics each shed more than 5%. Taiwan's TAIEX lost 1.22%.

Hang Seng futures barely moved. Currency markets also drew attention as the Japanese yen strengthened 0.1% to 158.42 per dollar, while the offshore yuan hardly changed at 6.6952. In India, the GIFT Nifty index which gives an indication of how the country's stock market opens for the day, predicted a muted start with a positive bias.
Traders would also be watching the Indian rupee closely after the Reserve Bank of India launched its most aggressive currency defence in more than a decade. The move signals that the RBI would use every tool available to stop the rupee slipping beyond 97 per dollar.

A US gauge of chipmakers sank 2.7% in that session. Investors now seemed to be questioning how much companies will spend on AI at a time when borrowing costs are climbing. The S&P 500 stood almost 120% above its 2022 low, so the four-year bull market depends on corporate profits keeping pace with lofty valuations.
That test begins on Tuesday, when Goldman Sachs Group, JPMorgan Chase, Citigroup and Wells Fargo will report their results. Bank of America and Morgan Stanley follow on Wednesday. Traders will also watch this week's US consumer price index for fresh signals on inflation.

On policy, Cleveland Federal Reserve President Beth Hammack said smaller, more frequent adjustments can help anchor inflation expectations according to a Bloomberg report. She stopped short of backing another rate rise this month. Brent crude fell 0.8% to around $105.80 a barrel, while West Texas Intermediate dropped 0.8% to $92.98.
With Bloomberg Inputs