(Bloomberg) — Asian stocks fell on Wednesday as weak corporate earnings in China raised fresh concerns about the country’s faltering economy. Traders are also awaiting earnings from Nvidia Corp. for clues about the growth momentum of artificial intelligence stocks.

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Chinese stocks in Hong Kong fell as much as 1.5 percent, while those in mainland China sank to their lowest since early February. Shares in bottled water maker Nongfu Spring Co. plunged as much as 13 percent after posting the lowest half-year profit growth in four years, making it the latest company to report disappointing results.

“So far, we’re still seeing a lot more downgrades than upgrades” in Chinese earnings, Winnie Wu, a China equity strategist at Bank of America Corp., told Bloomberg TV. Internet companies are beating earnings expectations, outperforming other sectors, but materials, technology, construction, auto and other industries pose significant downside risks, she said.

Most of the region’s major benchmarks were in negative territory, with Japan and South Korea also suffering losses. Yields on two-year US Treasuries, which are more sensitive to interest rate policy, fell by three basis points.

The weak sentiment toward China resurfaced after e-commerce company PDD Holdings Inc. issued cautious forecasts on its outlook earlier this week. The barrage of faltering growth continued in comments from other companies.

ANTA Sports Products Ltd. also cut full-year sales forecast for one of its core brands on Tuesday, citing expectations that the company would have to offer more discounts to attract buyers in the country. Meanwhile, Australia’s Fortescue Ltd. reported annual profit that was below analysts’ forecasts, partly due to a slowdown in iron demand from its biggest customer, China.

Cnooc Ltd., BYD Co. and Meituan are scheduled to report earnings on Wednesday. Later in the U.S., investors will be looking for clues as to whether the euphoria around artificial intelligence can continue to build, as the world’s most influential stock, Nvidia, is set to announce its results.

“We see weaker performance in Asia today, possibly because the time before Nvidia’s earnings release tonight may limit risk appetite,” said Jun Rong Yeap, market strategist at IG Asia Pte. “Given the extreme optimism that has prevailed for AI stocks over the past year, Nvidia’s results are seen as a pivotal moment for global markets.”

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A gauge of monthly inflation in Australia cooled in July, suggesting that price pressures have eased in the current quarter, but not quickly enough to justify early rate cuts. The Australian dollar was steady against the greenback after rising as much as 0.3 percent.

The yen extended its losses against the dollar to 0.4% after Ryozo Himino, deputy governor of the Bank of Japan, expressed his opinion. The BOJ will raise interest rates as long as inflation is in line with the bank’s expectations and it must monitor developments with “utmost vigilance,” Himino said.

Seven & i Holdings Co. shares slid after the 7-Eleven operator asked authorities for a federal safety designation, which could pose potential hurdles to a takeover. The request came after Alimentation Couche-Tard Inc. contacted the company last week.

Shares of Sony Group Corp. rose as much as 2.7% after the company announced it would raise the price of the PlayStation 5 in Japan.

“Ultimately, what’s more important for Japan are the economic fundamentals that are improving,” said David Chao, global market strategist at Invesco Asset Management, in a Bloomberg TV interview. “That will certainly be the reason why the Japanese market will be driven higher in the second half of the year.”

In other Asian corporate developments, shares of HSBC Holdings Plc rose in Hong Kong, outperforming the benchmark, after Bloomberg reported that Europe’s largest bank is considering plans that could lead to a reduction in middle management levels.

Shares of China’s top-selling automaker BYD fell as much as 3.1% in Hong Kong, even though the company expects overseas deliveries to account for almost half of total sales in the future.

Warren Buffett’s Berkshire Hathaway Inc. sold an additional $982 million worth of Bank of America shares, according to a regulatory filing.

Elsewhere, Bitcoin fell below the $60,000 mark early Wednesday amid a broader decline in crypto markets that also included a sharp decline in the second-largest token, Ether.

Oil prices held steady after falling in the previous session, ending a three-day rally. Gold prices eased after a three-day rise that had brought it closer to its all-time high.

Nvidia profits

Investors are bracing for big swings in Nvidia shares following the company’s $3.2 trillion earnings report. Trading in the options market implies a nearly 10% move in either direction the day after the earnings release. The stock has rallied about 160% this year and 1,000% since its bear market low in October 2022.

Analysts on average expect the giant chipmaker to forecast revenue growth of over 70% in the current quarter, with some predicting an even bigger increase. Nvidia’s results and forecasts will also serve as a barometer for AI spending across much of the tech industry.

Important events this week:

• Nvidia results, Wednesday

• Fed President Raphael Bostic and Fed Chairman Christopher Waller will speak on Wednesday

• Consumer confidence in the Eurozone, Thursday

• US GDP, initial jobless claims, Thursday

• Fed President Raphael Bostic speaks on Thursday

• Unemployment in Japan, CPI Tokyo, industrial production, retail sales, Friday

• CPI and unemployment in the Eurozone, Friday

• Personal income, spending, PCE in the US; consumer sentiment, Friday

Some of the key market movements:

Shares

• S&P 500 futures remained little changed as of 1:12 p.m. Tokyo time

• Nasdaq-100 futures fell 0.2 percent

• Japan’s Topix remained little changed

• Australia’s S&P/ASX 200 fell 0.4 percent

• The Hang Seng in Hong Kong fell 1 percent

• The Shanghai Composite fell 0.2%

• Euro Stoxx 50 futures remained barely unchanged

Currencies

• The Bloomberg Dollar Spot Index rose 0.1%

• The euro fell 0.2 percent to 1.1166 dollars.

• The Japanese yen fell 0.4% to 144.48 per dollar

• The offshore yuan fell 0.2% to 7.1322 per dollar.

Cryptocurrencies

• Bitcoin fell 3.7% to $59,552.98

• Ether fell 4.2% to $2,474.36

Bonds

Raw materials

• West Texas Intermediate crude oil remained barely unchanged

• The spot price of gold fell 0.4% to $2,514.60 per ounce

This story was created with the assistance of Bloomberg Automation.

– With support from Abhishek Vishnoi.

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