Asia stocks steady as chip sell-off eases ahead of megacap tech earnings
The MSCI Asia-Pacific Index was little changed as gains in Japan offset weakness elsewhere
Published Tue, Jul 21, 2026 · 09:42 AM
ASIAN stocks on Tuesday (Jul 21) held three days of losses as traders stayed cautious ahead of megacap tech earnings this week.
Oil slipped from its highest close since mid-June as an escalation in Middle East hostilities rekindled worries about inflation.
The MSCI Asia-Pacific Index was little changed as gains in Japan, where trading resumed after a holiday Monday, offset weakness elsewhere.
Among the main moves in markets, the S&P 500 futures were little changed as of 9.13 am Tokyo time.
The Hang Seng futures fell 0.2 per cent, Japan’s Topix rose 0.9 per cent and Australia’s S&P/ASX 200 fell 0.5 per cent.
US equity-index futures declined 0.1 per cent after a gauge of chip stocks in the US rebounded from last week’s sell-off.
Elsewhere, the Canadian dollar held steady after the Trump administration vowed to impose a fresh 50 per cent tariff on some of the country’s goods.
The pound held its losses from the previous session as UK’s new prime minister Andy Burnham named former Defense Secretary John Healey to be his Chancellor of the Exchequer in a surprise move.
Brent crude fell 0.4 per cent to US$88.86 a barrel as traders watched for disruptions to Saudi Arabian exports after Houthi rebels threatened to blockade a key export route through the Red Sea.
Worries that higher energy costs could boost inflation spurred bond losses in the last session.
Elevated oil prices and Middle East tensions are giving traders a new reason for caution, compounding a shift out of tech stocks after 2026’s blistering rally.
Investors are now turning to megacap earnings later this week for clues on whether this year’s artificial intelligence-driven rally can be sustained.
“The Iran situation continues to roil markets,” said veteran strategist Louis Navellier. “This is holding back the stock gains that should be expected given the strong earnings trends.”
This week brings the first results from the US megacaps, and pressure is building for the companies to justify AI investments.
Tesla and Alphabet kick off big tech’s reporting season on Wednesday. Then, Microsoft, Meta Platforms, Apple and Amazon.com hit the following week.
In geopolitical news, UK gilts declined after Burnham unnerved investors over his approach to the country’s finances.
The sell-off on Monday pushed yields on long-dated gilts to their highest since late May after Burnham said he will seek “any flexibility” while following the government’s borrowing and spending rules.
Tariff concerns resurfaced after the Trump administration vowed to impose a fresh 50 per cent levy on some Canadian goods, citing what it called unfair treatment of American alcohol, cars and dairy products, further inflaming trade tensions between the two neighbours.
If Trump follows through with the levies, which are set to take effect in 30 days, the move would mark one of the most severe trade actions he’s taken against the US’ second-largest trading partner.
Attention, however, remains firmly on the Middle East as US forces struck Iranian targets after US President Donald Trump vowed Teheran “will pay” for killing three US soldiers.
On Monday, the Iran-backed Houthis said they would impose a ban on maritime traffic from Saudi Arabia, threatening the Red Sea route that has allowed the kingdom to export millions of barrels of crude a day via its cross-country pipeline bypassing the Strait of Hormuz.
Saudi Arabia said it would take all necessary measures to protect its ships following the threats by the Teheran-backed Houthi militants in Yemen.
“For stocks to rebound, we need some solid earnings from the key tech names this week, and deescalation in Iran wouldn’t hurt,” said Tom Essaye at The Sevens Report. BLOOMBERG
