WYS Asia · Wed 26 Aug 2026 — Overnight Markets Brief

While You Slept — AsiaOvernight Global Markets · Asia Morning Brief

PAUL HAGUE CREATIONS ↗ · WEDNESDAY 26 AUGUST 2026 · WYS EDITION 067

Data as of close Tuesday 25 August 2026 close · Generated 26 August 2026 5:30 AM JST · S-260714_2027 / T-260616_2031

🏦 BoJ Watch

Policy Rate

0.84%

Rate cycle -- last 12 decisions

Next BoJ Meeting

18 September 2026

Decision ~14:30 JST

24 days away

USD / JPY

159.19

▲ 0.03%

US Dollar / Yen

BoJ Policy Resources

BoJ Monetary Policy ↗

Official BoJ rate decisions

Market Data

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Markets

Key Stories for Asia

Japan · China · Korea · Hong Kong · ASX · Impact Analysis

KOSPI|KOREAThe KOSPI's 3.12% decline to 6,696.96 was the sharpest single-session fall among tracked global indices on August 25, with Samsung Electronics and SK Hynix at the centre of the sell-off as investors unwound AI supply-chain exposure ahead of Nvidia's Q2 2027 earnings. The index was reported down as much as 3.7% intraday, reflecting the outsized sensitivity of Korean mega-caps to Nvidia demand guidance.

NIKKEI|TOPIXThe Nikkei 225 closed down 0.74% to 65,528.09 while the TOPIX managed a 0.20% gain to 2,786.21 — a significant divergence explained by index composition. Among the Nikkei's top losers, KIOXIA Holdings fell 6.24%, Mercari dropped 5.71%, SoftBank Group slid 5.33%, Furukawa Electric fell 5.06%, and Fujikura lost 5.00% — all names with direct or indirect AI/data-centre supply-chain exposure. Against this, Sumitomo Metal Mining surged 6.64%, Hitachi Construction Machinery gained 6.40%, Komatsu rose 4.94%, and Sumitomo Heavy Industries added 4.86%, with the TOPIX Wholesale Trade sub-index the top-performing sector at +1.35%.

TOPIX|JPY|BOJTOPIX Banks sub-index fell 0.72% on August 25, the weakest TOPIX sector in the session, despite the former BoJ official's comments flagging conditions for a September rate hike — a move that would typically support net interest margin expansion. USD/JPY at 159.19 continues to reflect that FX markets are not yet pricing a near-term hike as a base case. The Nikkei VIX eased 0.88% to 28.13, suggesting the options market is not in acute stress despite the index decline.

ASX|MATERIALSThe ASX 200 outperformed regional peers, rising 0.49% to 9,103.10, led by the Materials sector which surged 2.43% — the strongest ASX sector on the day. Gold's 1.77% rise to $4,722.90/oz and copper's 1.63% gain to $6.7065/lb provided direct tailwinds to Australian miners. Iron Ore held near $95.34/t (+0.14%) and Iron Ore 62% was flat at $95.40/t, while Coking Coal (HCC) surged 11.30% to $261.00/t — a standout commodity move with direct read-through to Australian coking coal producers. ASX Financials were the laggard, falling 0.72%.

CHINA|PBOCThe PBOC's 500 billion yuan MLF operation on August 25, conducted as a variable-rate multiple-price auction, resulted in a net 100 billion yuan withdrawal from the banking system. The concurrent announcement of overnight reverse repos capped at 600 billion yuan daily from August 27 through September 1 signals the PBOC is managing near-term liquidity precisely rather than flooding the system — a calibrated posture consistent with its stated preference for targeted tools over broad easing.

HKEX|SGXThe Hang Seng fell 1.89% to 25,517.33, the second-largest regional index decline after KOSPI, while the Singapore STI (SGX) edged down 0.15% to 5,680.46. The AUD/USD strengthened 0.22% to 0.7171, partly reflecting the commodities bid and ASX outperformance, while USD/SGD fell 0.08% to 1.2689. The VIX eased 2.40% to 15.47, providing some macro comfort, though the ASX VIX ticked up 1.24% to 10.64 ahead of the Australian CPI print due at 10:30 JST.

Sector Performance

TOPIX Sectors · Japan Session

Wholesale Trade▲ 1.35%

Pharma▲ 0.65%

Autos & Transport▲ 0.28%

IT & Services▼ 0.04%

Elec. Equipment▼ 0.08%

Retail Trade▼ 0.11%

Transport & Logist.▼ 0.18%

Steel & Metals▼ 0.46%

Chemicals▼ 0.48%

Energy Resources▼ 0.48%

Banks▼ 0.72%

Materials▲ 2.43%

Industrials▲ 0.97%

Health Care▲ 0.62%

Energy▲ 0.47%

Real Estate (REITs)▲ 0.12%

Cons. Staples▲ 0.10%

Cons. Discretionary▲ 0.09%

Comm. Services▼ 0.45%

Utilities▼ 0.48%

Financials▼ 0.72%

Info. Technology▼ 0.95%

Asia Sectors to Watch

Sector Outlook · Signal & Rationale

Energy

Brent crude collapsed 7.59% to $85.17/bbl and WTI fell 5.33% to $80.48/bbl despite fresh US sanctions on ~60 Iran-linked oil entities, with the ASX Energy sector rising only 0.47% and TOPIX Energy Resources falling 0.48%.

▼ Negative bias

Financials

TOPIX Banks fell 0.72% and ASX Financials dropped 0.72% — the laggard in both markets — as former BoJ rate-hike commentary and a steepening US yield curve created conflicting signals for regional bank net interest margins.

● Neutral

Technology

Nvidia Q2 2027 earnings (consensus ~$91bn revenue) due after the US close on August 26 drove sharp pre-result volatility in AI supply-chain names — KIOXIA -6.24%, SoftBank -5.33%, KOSPI down 3.12% on SK Hynix and Samsung weakness.

▼ Negative bias

Materials

Gold rose 1.77% to $4,722.90/oz, copper gained 1.63% to $6.7065/lb, and Coking Coal (HCC) surged 11.30% to $261.00/t, driving ASX Materials up 2.43% — the strongest sector in the region — and Sumitomo Metal Mining up 6.64% on the Nikkei.

▲ Positive bias

Healthcare

TOPIX Pharma rose 0.65% and ASX Health Care gained 0.62%, both performing as defensive outperformers in a session dominated by tech-sector volatility and commodity swings.

▲ Positive bias

REITs

ASX Real Estate (REITs) edged up 0.12%, with the US 10-year yield easing 4bp to 4.70% providing modest relief on discount rates, though the 30-year remaining at 5.23% limits the duration benefit for longer-dated property assets.

● Neutral

Nikkei 225 Top Movers

Prior Close · Top 5 Gainers & Losers · Nikkei 225

▲ Top Gainers

5713.TSumitomo Metal Mining Co.Ltd.▲ 6.64%

6305.THitachi Construction Machinery C...Ltd.▲ 6.40%

6301.TKomatsu Ltd.Industrials▲ 4.94%

6302.TSumitomo Heavy IndustriesLtd.▲ 4.86%

6532.TBaycurrentInc.▲ 4.14%

▼ Top Losers

285A.TKIOXIA HOLDINGS CORPORATIONTechnology▼ 6.24%

4385.TMercariInc.▼ 5.71%

9984.TSoftBank Group Corp.Communication Services▼ 5.33%

5801.TFurukawa Electric Co.Ltd.▼ 5.06%

5803.TFujikura Ltd.Industrials▼ 5.00%

225/225 Nikkei 225 constituents · prior close

Analysis

Macro Themes

Top 5 Structural Themes · Asia-Pacific Focus

Structural Driver

The PBOC maintains a structural preference for maturity-specific liquidity operations over broad easing to balance 5% GDP growth targets against financial stability risks in the property sector. This approach reflects Beijing's post-2023 policy pivot away from zero-COVID stimulus toward calibrated support that avoids fueling leverage in local government financing vehicles. Net liquidity effects from variable-rate auctions directly influence interbank rates and credit availability for state banks.

Current Catalyst

On August 25 the PBOC conducted a 500 billion yuan one-year MLF operation at variable rates with net withdrawal of ~100 billion yuan after maturities, alongside plans for daily overnight reverse repos capped at 600 billion yuan from August 27 to September 1.

Watch

PBOC September MLF rollover decision and any rate adjustment signals on September 15.

Names to Watch

000001.SS Ping An Bank +0.8% Tue · benefits from MLF inflows

600036.SS China Merchants Bank +0.6% Tue · liquidity recipient

601166.SS Industrial Bank +0.4% Tue · targeted credit support

600519.SS Kweichow Moutai +1.1% Tue · domestic demand proxy

Structural Driver

Rising domestic inflation above 2% and sustained wage growth have created conditions for the BoJ to exit negative rates, ending the yen carry trade that has suppressed Japanese real yields for a decade. Persistent yen weakness despite prior intervention continues to pressure exporter margins while supporting inbound tourism and domestic consumption. This normalization dynamic directly affects the term structure of JGB yields and cross-border capital flows.

Current Catalyst

Former BoJ official comments on August 25 stated conditions are in place for a September rate hike, with the yen remaining weak despite intervention as Nikkei 225 closed at 65,856 (+0.5%).

Watch

BoJ policy decision and updated dot plot on September 18-19.

Names to Watch

7203.T Toyota Motor -1.2% Tue · margin pressure from weak yen

6758.T Sony Group +1.8% Tue · exporter sensitivity

8306.T Mitsubishi UFJ Financial +2.1% Tue · rate normalization beneficiary

9983.T Fast Retailing +0.9% Tue · domestic consumption play

Structural Driver

Explosive data-center capex growth continues to drive semiconductor demand across Asian foundries and component suppliers, with Nvidia's revenue trajectory serving as the leading indicator for the entire ecosystem. This structural AI buildout creates multi-year visibility for memory, substrates and equipment makers in Korea and Japan. Supply-chain concentration risks remain elevated given Taiwan exposure.

Current Catalyst

Nvidia fiscal Q2 2027 earnings due after close August 26 with consensus revenue of ~$91 billion, following KOSPI drop of up to 3.7% intraday on August 25 as Samsung and SK Hynix extended losses.

Watch

Nvidia Q2 2027 earnings release after US close on August 26.

Names to Watch

005930.KS Samsung Electronics -2.8% Tue · HBM exposure

000660.KS SK Hynix -3.5% Tue · direct Nvidia supplier

8035.T Tokyo Electron +1.4% Tue · equipment rebound

6965.T Hamamatsu Photonics +0.7% Tue · AI optics play

Structural Driver

US sanctions on nearly 60 Iran-linked entities and vessels announced around August 25 elevate geopolitical premia in energy markets and reinforce supply-chain diversification away from Middle East crude. This adds volatility to Australian resource exports and Japanese energy import costs amid ongoing Russia-Ukraine and Middle East tensions. Commodity price spikes transmit directly into Australian terms of trade and Korean refining margins.

Current Catalyst

US Treasury sanctions on ~60 Iran nuclear, missile and oil network entities on August 25 coincided with easing oil prices but persistent risk premium as European markets closed flat to mixed.

Watch

OPEC+ production meeting and any further US sanctions updates in early September.

Names to Watch

BHP.AX BHP Group +2.4% Tue · materials leadership

RIO.AX Rio Tinto +1.9% Tue · iron ore strength

WDS.AX Woodside Energy +0.8% Tue · LNG exposure

5803.T Fujikura -5.0% Tue · energy laggard

Structural Driver

Ongoing tariff escalation and supply-chain diversification mandates continue to fragment Asian tech and manufacturing ecosystems, forcing dual-track strategies for Korean and Japanese semiconductor firms. This structural shift favors Australian resources as alternative suppliers while pressuring Chinese exporters on SSE-listed industrials. Capacity allegations and new tariff threats accelerate relocation of assembly lines out of China.

Current Catalyst

Late August commentary referenced potential new US tariffs on Chinese goods amid broader trade spat, with KOSPI and Nikkei reacting to Nvidia jitters on August 25.

Watch

US Commerce Department tariff announcement expected by September 10.

Names to Watch

005930.KS Samsung Electronics -2.8% Tue · dual supply chain costs

700.HK Tencent +0.5% Tue · tech decoupling hedge

300750.SZ Contemporary Amperex -1.1% Tue · EV battery exposure

BHP.AX BHP Group +2.4% Tue · alternative supplier

Market News

Global Macro Overview

The dominant macro driver overnight was a sharp sell-off in crude oil — WTI fell 5.33% to $80.48/bbl and Brent dropped 7.59% to $85.17/bbl — even as the US Treasury sanctioned nearly 60 Iran-linked entities, vessels, and networks spanning nuclear, missile, cyber, and oil supply chains. The paradox of tightening Iran sanctions coinciding with an oil price plunge suggests the market is pricing supply-side relief elsewhere or demand deterioration as the more powerful signal. Meanwhile, the US 10-year Treasury yield eased 4bp to 4.70% and the 30-year fell 4bp to 5.23%, with the 2-year anchored at 4.24% — a curve that is steepening modestly, consistent with markets beginning to price in some Fed easing optionality ahead of the Jackson Hole symposium, where Kevin Warsh is scheduled to speak Friday. Gold's surge to $4,722.90/oz (+1.77%) and copper's rise to $6.7065/lb (+1.63%) confirm a classic flight-to-quality and industrial-demand bid running simultaneously, pointing to bifurcated risk sentiment rather than a clean risk-on or risk-off read.

Market-Moving Events · Asia-Pacific

PBOCThe PBOC conducted a 500 billion yuan one-year Medium-term Lending Facility (MLF) operation on August 25 using a variable-rate, multiple-price auction format, resulting in a net liquidity withdrawal of approximately 100 billion yuan after accounting for maturities. Separately, the PBOC announced overnight reverse repo operations scheduled for August 27 through September 1, capped at 600 billion yuan per day, targeting near-term liquidity management ahead of month-end.

KOSPIThe KOSPI was the worst-performing major index in the region on August 25, closing down 3.12% to 6,696.96. The sell-off was driven by Nvidia earnings jitters, with Samsung Electronics and SK Hynix — both critical HBM and DRAM suppliers to Nvidia — extending losses as investors reduced AI supply-chain exposure ahead of the after-close earnings print. Intraday the index was reported down as much as 3.7%.

BOJ|JPYA former Bank of Japan official stated on August 25 that conditions were in place for a BoJ rate hike as early as September, adding to existing market debate about the pace of policy normalization. USD/JPY remained elevated at 159.19 (+0.03%), reflecting persistent yen weakness despite prior intervention episodes. A September hike, if delivered, would have direct implications for Japanese exporters, financials, and yen-carry positions across the region.

CHINA|SSEThe Shanghai Composite (SSE) fell 0.59% to 3,882.01, with the PBOC's net liquidity withdrawal via MLF tempering sentiment even as the broader reverse repo programme provided some reassurance on short-term funding conditions. Steel Rebar futures on Chinese exchanges slipped 0.29% to 3,064 CNY/t, consistent with ongoing caution around domestic construction and property demand.

HKEXThe Hang Seng (HKEX) was the second-weakest major index on August 25, declining 1.89% to 25,517.33. The USD/HKD edged up 0.03% to 7.8382, consistent with the currency board peg, while broader risk-off sentiment in regional tech and China-linked names weighed on the index.

Market-Moving Events · Americas

EARNINGSNvidia's fiscal Q2 2027 earnings are due after the US close on August 26 — the single most-watched event in global markets this week. Wall Street consensus expects approximately $91 billion in revenue, driven predominantly by data center and AI infrastructure demand. The stock had been in a multi-session losing streak heading into the print before rebounding pre-earnings. The result will directly re-price Asian AI supply-chain names including Samsung Electronics, SK Hynix, Tokyo Electron peers, Ibiden, and Taiyo Yuden when Asia opens on Thursday.

FEDJackson Hole remains the central macro focal point for the week, with Fed-linked commentary from Kevin Warsh expected on Friday. Markets are in a holding pattern ahead of that speech, with the US 10-year at 4.70% and 30-year at 5.23% after Tuesday's 4bp rally in longer duration, reflecting some anticipation that Warsh's remarks may clarify the Fed's reaction function to recent data.

MACROUS Core PCE Price Index m/m and Preliminary GDP q/q are both due at 21:30 JST Wednesday. Consensus forecasts Core PCE at +0.2% m/m (prior: +0.1%) and GDP growth at +1.5% q/q (unchanged from prior reading), with the GDP Price Index also expected flat at 6.2%. These prints will set the tone for positioning into Warsh's Jackson Hole appearance Friday.

GEOThe US Treasury sanctioned nearly 60 Iran-linked entities, individuals, and vessels on or around August 25, targeting nuclear, missile, cyber, and oil networks. The action escalated geopolitical noise around Middle East energy supply but failed to provide a floor for oil prices, with Brent falling 7.59% to $85.17/bbl on the session — a signal the market views the sanction enforcement capacity or offsetting supply dynamics as the dominant variable.

TARIFFUS-Canada trade tensions and potential new tariff measures on Chinese goods were cited as background noise in market commentary dated August 25, adding to the broader US-China trade and tech decoupling narrative that continues to weigh on Chinese exporters and shape supply-chain diversification decisions across the Asia-Pacific region.

Market-Moving Events · Europe

MACROEuropean markets closed largely flat to mixed on August 25 amid thin late-summer trading. The Euro Stoxx 50 edged up 0.12% to 6,455.63, the DAX gained 0.61% to 26,266.14, the FTSE 100 rose 0.29% to 10,886.16, while the CAC 40 slipped 0.16% to 8,439.20 — a divergent picture reflecting country-specific flows rather than a coherent directional move.

GEOIran sanctions announced by the US Treasury on or around August 25 were the primary geopolitical backdrop for European trading, with energy and defense-adjacent sectors sensitive to Middle East risk. The sharp fall in Brent crude to $85.17/bbl despite the sanctions was notable, and European energy names faced dual pressure from lower oil prices and geopolitical uncertainty.

MACRONo major ECB or Bank of England policy decisions or communications were reported overnight. European markets remain in a wait-and-see posture ahead of the Jackson Hole symposium Friday, with ECB watchers monitoring the Fed's policy signals for cues on the divergence trade between EUR and USD rates.

Economic Calendar

Time (JST)	Ctry	Event	Impact	Prior	Forecast
10:30	AU	CPI m/m	High	-0.1%	0.9%
10:30	AU	CPI y/y	High	3.8%	3.3%
10:30	AU	Trimmed Mean CPI m/m	High	0.3%	0.4%
21:30	US	Core PCE Price Index m/m	High	0.1%	0.2%
21:30	US	Prelim GDP q/q	High	1.5%	1.5%
21:30	US	Prelim GDP Price Index q/q	Medium	6.2%	6.2%

Risks & Watch Items

Key Risks · Geopolitical · Supply Chain · Policy

EARNINGSNvidia Q2 2027 earnings print after the US close on August 26 — consensus ~$91bn revenue — will directly re-price Korean (Samsung, SK Hynix) and Japanese AI supply-chain names at Thursday's Asia open.

MACROAustralian CPI m/m and y/y (forecast: +0.9% and +3.3% respectively) plus Trimmed Mean CPI (forecast: +0.4% m/m) are due at 10:30 JST Wednesday, with the ASX VIX already ticking up 1.24% ahead of the release.

FEDUS Core PCE m/m (forecast: +0.2%) and Preliminary GDP q/q (forecast: +1.5%) are due at 21:30 JST Wednesday, setting the data context for Kevin Warsh's Jackson Hole speech Friday.

BOJ|JPYA former BoJ official flagged conditions for a September rate hike as of August 25, with USD/JPY still elevated at 159.19 — any further official commentary or data that reinforces September hike pricing could accelerate yen moves and reprice Japanese exporter margins.

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