Asian stocks continued their decline, with the chip sector leading the losses, but crypto assets did not follow suit. Bitcoin rose about 1% on Wednesday, briefly reaching around $63,800; Ethereum, XRP, BNB, and other major tokens also generally rose, indicating a divergence in short-term correlations within risk assets.
Chip stocks plunged, but the crypto market remained resilient.
South Korean stocks became the epicenter of this sell-off. Reports indicate that the benchmark South Korean stock index fell sharply for two consecutive days. SK Hynix, despite a 557% year-on-year increase in quarterly profits, still plummeted by about 17% due to weaker-than-expected earnings. Samsung Electronics also fell by about 12% ahead of its earnings report.
As a result, the MSCI Asia Pacific Index fell to its lowest level since mid-April, and Nasdaq 100 futures also continued to decline. In contrast, the crypto market performed relatively steadily. Except for Hyperliquid's HYPE, which fell by about 3%, most major tokens maintained an upward trend or remained flat.
Bitcoin failed to follow tech stocks in its two declines.
The report noted that since July, the price movements of crypto assets have been highly synchronized with AI-related stocks; when chip stocks rose, Bitcoin often followed suit, and when chip stocks fell, the crypto market would also come under pressure. However, this correlation has loosened in the last two trading sessions.
Last week, while major US tech stocks corrected, Bitcoin saw limited volatility; this week, Asian chip stocks plunged again, but Bitcoin remained above $63,000. While this isn't enough to suggest a complete reversal of the correlation, it at least indicates that the synchronized decline that dominated the market in July has not yet strengthened.
The Fed's decision and US data will be the next focus.
On the macro level, the market will next focus on the Federal Reserve's interest rate decision. Reports indicate that traders are currently pricing in approximately a 15% probability of a rate hike. Following the interest rate decision, US core PCE inflation data, second-quarter GDP, and a new round of earnings reports from major technology companies will also be released.
Bitcoin briefly dipped below $63,000 earlier this week, partly due to the US Senate's postponement of the Clarity Act. This bill, which pertains to crypto market structure legislation, had initially raised market expectations for its passage. However, after the news was digested, Bitcoin's price quickly rebounded.
- Bitcoin rose about 1% to around $63,800.
- Ethereum rose about 1% to $1,899.
- XRP rose about 2% to $1.07.
