Asian stocks dragged by tech, yen gains little traction as BOJ holds

Asian stocks slid on Thursday as chip-sector stocks tracked overnight declines by Wall Street peers and Facebook owner Meta Platforms warned of accelerating costs for artificial intelligence.

More megacap tech earnings are due later in the day from Apple and Amazon.

The yen hovered close to a three-month low against the dollar, weighed down by political instability as a drubbing for Japan's ruling coalition in parliamentary elections last weekend could delay a normalisation of monetary policy.

The Bank of Japan made little mention of politics when keeping rates unchanged on Thursday, reiterating only that there were many uncertainties about the economic outlook.

Its policy statement ran to just two lines, while a separate economic update showed it still planned to tighten policy over time if the economy developed as expected.

More broadly, the dollar was taking a breather, having pulled back from a near three-month peak to major peers on Wednesday.

Investors were also treading warily ahead of US non-farm payrolls data on Friday, the presidential election next Tuesday and a Federal Reserve policy decision on Thursday.

Japan's Nikkei share average fell 0.5% as of 0155 GMT. South Korea's Kospi dropped 1.3%.

North Korea stirred regional tensions by test firing what a US official said was an intercontinental ballistic missile into the sea off the reclusive nation's east coast on Thursday.

Hong Kong's Hang Seng added 0.2%, but mainland Chinese blue chips slipped 0.7%. Investors are awaiting more clarity on stimulus from Beijing next week, when officials convene a week-long congress.

Surveys on manufacturing and services in China did show some pick up in activity, with the official purchasing managers' index (PMI) rose to 50.1 in October.

Taiwanese markets were shuttered due to a typhoon.

S&P 500 futures eased 0.35%, while Nasdaq futures dipped 0.47%. The Philadelphia SE semiconductor index slumped 3.35% overnight, with Advanced Micro Devices tumbling more than 10% following dour forecasts.

EUROSTOXX 50 futures and DAX futures both eased 0.4%, while FTSE futures fell 0.1%.

TOUGH MONTH FOR YEN

The US dollar index was steady at 104.15 following its pullback from the highest since Aug. 2 at 104.63 reached on Tuesday.

The dollar was a fraction lower on the yen at 153.36 , but not far from this week's high of 153.885.

The dollar is still up a heady 6.8% so far in October and heading for its best month since late 2016 as political uncertainty in Japan further delays rate hikes.

The euro has also gained 4% on the yen this month to reach 166.65 yen .

"Japan's messy political situation is a boon for currency speculators," said Shoki Omori, chief Japan desk strategist at Mizuho Securities. But for the most part, "the ball is on the dollar side," he said.

"If the US sees more mixed data, we might see higher volatility in the pair," Omori said. "Non-farm payrolls is going to change the picture if it comes out completely different from consensus."

The personal consumption expenditures index, the Fed's preferred measure of inflation, is also due later on Thursday.

Meanwhile, in the final stretch of the US presidential contest, opinion polls still put Republican Donald Trump and Democrat Kamala Harris neck-and-neck, although financial markets and some betting platforms have been leaning toward a Trump victory.

Gold reached a fresh all-time high of $2,790.15 per ounce.

Oil prices extended a rally from Wednesday, driven by optimism over US fuel demand following an unexpected drop in crude and gasoline inventories.

Brent crude futures gained 0.5% to $72.90 a barrel and US West Texas Intermediate crude futures climbed 0.5% to $68.93 per barrel. Both contracts rose more than 2% in the previous session.