Asia share indexes fell Thursday while the dollar rallied as sudden selling on Wall Street and delays with coronavirus vaccines shook market participant optimism.
MSCI's broadest index of Asia-Pacific shares outside Japan fell 1.2%, with valuations looking stretched given the index had risen more than 6% just this month.
Japan's Nikkei fell 1.3%, its sharpest drop since October, and China blue chips gave up 1.5%. South Korea eased 0.9% led by losses in Samsung after it reported earnings.
Even the technology darlings weren't immune with Facebook down despite reporting earnings well above expectations. Apple Inc. also handily beat forecasts, yet its shares lost 3% after the bell.
There was a hint of resilience in Asia as U.S. stock futures pared steep early losses. S&P 500 futures were off 0.1% and Nasdaq futures were down 0.2%.
There was no obvious trigger for selling - rather many seemed to have rushed for the exits at the same moment in a market that had been priced for perfection.
Dealers said highly leveraged market participants were taking profits where they could to cover losses elsewhere, leading to sharp falls in a lot of overcrowded trades.
Some pointed a finger at retail market participants who had forced a massive squeeze on hedge funds with short positions in stocks such as GameStop.
GameStop and several other highly-bid stocks later retreated in extended trade after Reddit briefly restricted access to its popular WallStreetBets site.
Treasury 10-year yields fell 3 basis points overnight to 1.01%, well off the recent peak at 1.187%.
The safe-haven U.S. dollar gained broadly, with its index up at 90.727 from a January low of 89.206. The dollar firmed to 104.28 yen and away from the week's trough of 103.54.
The euro fell back to $1.2093 amid reports the European Central Bank felt markets were under pricing the risk of more rate cuts.
Commodity linked currencies were hit by all the economic angst, with the Australian and New Zealand dollars both shedding more than 1% overnight.
The bounce in the dollar kept gold prices soft around $1,836 an ounce.
World demand concerns restrained oil prices despite a huge drop in U.S. crude stocks. U.S. crude fell 24 cents to $52.61 a barrel, while Brent crude futures dropped 26 cents to $55.55.
Apple, Inc. Wednesday reported holiday quarter sales and profits that beat Wall Street expectations, as new 5G iPhones helped push handset revenue to a new high and sparked a 57% rise in China sales.
Apple shipped its iPhone 12 lineup several weeks later than usual, but an expanded number of models and new look tapped pent up demand for upgrades, especially in China. The company also posted strong sales of its Mac laptops and iPads in the quarter, driven by consumers working, learning and playing from home during the pandemic.
Apple's revenue for the quarter ended Dec. 26 rose 21% to $111.44 billion. Earnings per share rose to $1.68 from $1.25, beating Wall Street targets, according to IBES data from Refinitiv. Sales of iPhones were $65.60 billion and beat a record set three years ago.
Facebook, Inc. soundly beat quarterly revenue estimates Wednesday after heavy holiday advertising by e-commerce retailers, but it warned Apple's impending privacy changes could hurt revenue by interfering with ad targeting.
The world's biggest social media company said it expected to face "significant ad targeting headwinds in 2021." Facebook forecast that Apple's update of its iPhone operating system to iOS 14 could start biting into revenues as early as the end of the first quarter.
Meanwhile, Boeing Co. took a hefty $6.5 billion charge on its all-new 777X jetliner as it posted a record annual loss Wednesday due to the coronavirus pandemic and the aftermath of a two-year safety crisis over its 737 MAX.
The results cap a tumultuous year for the world's largest aerospace company during which the pandemic erased demand for the industry's largest jetliners just as Boeing fights to emerge from the nearly two-year grounding of its bestselling 737 MAX after fatal crashes.
Boeing said it now expects the 777X, a larger version of the 777 minijumbo, to enter service by late 2023, three years later than initially planned, with a longer and costlier certification process after scrutiny over the 737 MAX.
