Asia Markets Mark Time Ahead of Warsh; RBA Data, Nvidia Beat

Asian markets traded cautiously on Thursday, with much of the region's price action muted as traders held off making big bets ahead of Federal Reserve Chair Kevin Warsh's Jackson Hole speech. The symposium opens Thursday evening US time; Warsh is due to speak Friday morning.

The one notable flashpoint came in the Middle East. The UK Maritime Trade Operations agency said Iran struck a Kuwaiti oil tanker on 25 August in the Strait of Hormuz's US-backed southern corridor while the vessel was transiting under US escort. Beyond that incident, Middle East news flow was otherwise quiet and oil prices traded in a subdued fashion. Gold pushed back up toward $4640 before stalling, with dollar depreciation concerns and worries over rising US debt levels cited as the factors still underpinning the metal.

Australian data added to the hawkish narrative building around the Reserve Bank of Australia. Household spending rose 1.1% month on month in July, nearly triple the 0.4% pace forecast, with annual growth accelerating to 7.0% from 6.1%. The beat builds further on the case for an RBA hike established by Wednesday's stronger-than-expected CPI print, and the Australian dollar remained underpinned by growing rate hike expectations.

China's industrial sector offered a more mixed signal. Profit growth slowed to an 11.2% annual pace in July, a seven-month low, according to National Bureau of Statistics data, with the January-to-July run rate easing to 17.6% from 18.7% in the first half. The figures suggest the AI-driven turnaround that had been lifting industrial profits from years of declines is starting to lose momentum. Separately, the People's Bank of China resumed net injections through overnight reverse repos on Thursday, as cash demand picked up ahead of month end.

Central bank commentary out of Asia leaned hawkish elsewhere too. Bank of Japan Deputy Governor Ryozo Himino called for timely rate hikes to avoid a future spike in inflation that could force more abrupt tightening later, and flagged a weak yen as a factor that could push up inflation at a faster pace than in the past. Despite the hawkish tone, the yen softened regardless, with USD/JPY back at 159.40. The Bank of Korea delivered a second consecutive rate hike, lifting its policy rate to 3.00% from 2.75%.

In earnings, Nvidia posted better-than-expected second-quarter fiscal 2027 results after Wednesday's close, though shares slipped as much as 3% in after-hours trading against high investor expectations. The share price bounced back strongly though. Chief Financial Officer Colette Kress told analysts the company now expects fiscal 2028 revenue growth of around 70%, well above the roughly 44% analysts had previously forecast, saying demand is still accelerating even at Nvidia's current scale and that customer forecasts point to growth roughly doubling next year, with the 70% figure reflecting supply constraints rather than a ceiling on demand. Chief Executive Jensen Huang said Nvidia has never before given guidance this far in advance, and that underlying demand growth is actually running closer to 100%, with the official outlook capped by current supply capacity rather than by demand itself. Nvidia separately agreed to buy open source model repository Hugging Face for $12.9 billion, according to The Information.