Asia markets opened lower on Wednesday, likely tracking Wall Street’s negative close overnight after Goldman Sachs earnings missed the mark.
Investors also remained vigilant amid U.S.-North Korea tensions and the nearing of the French presidential election.
Stocks in Japan fell, with the Nikkei opening down 0.3 percent. Australia’s shares were also lower, with the S&P/ASX 200 down 0.3 percent.
In South Korea, the Kospi shed 0.12 percent.
U.S.-North Korea tensions lingered. Vice President Mike Pence, arriving in Tokyo from South Korea, reassured Japan of American commitment to reining in North Korea’s nuclear and missile ambitions on Tuesday, after warning that U.S. strikes in Syria and Afghanistan showed the strength of its resolve.
The reclusive North has conducted a series of missile and nuclear tests in defiance of U.N. sanctions.
European equities fell broadly after U.K. Prime Minister Theresa May called for a snap election in June. The announcement also sent the British pound on a wild ride. The currency rose sharply after initially falling as low as $1.2520 on word that May would make an important announcement.
After the announcement the pound rose as high as $1.2904 on Tuesday. On Wednesday, it was fetching $1.2841 at 7:59 a.m. HK/SIN.
Naeem Aslam, chief market analyst at Think Markets, said in a note on Wednesday that the rally on the surprise snap election may be premature.
“Traders are getting well ahead of themselves,” he said. “Theresa May could easily win the upcoming election according to the latest polls. However, this doesn’t not mean that Brexit negotiations with the EU partners would become easy,” he added, noting “it is the EU which would be very much calling the shots.”
Aslam also noted that May’s lead could fade before the June 8 voting as the election could be seen as an opportunity for opponents to derail Brexit.
The dollar index, which measures the greenback against a basket of currencies, tumbled to 99.475 by 7:33 a.m. HK/SIN from levels over 100 overnight after weaker-than-expected housing starts, which fell 6.8 percent last month, compared with expecations for a 3.9 percent decline.
“The Beige Book is scheduled for release on Wednesday and while the U.S. economy in general continues to recover, if Fed districts report a slowdown, the dollar could extend its losses quickly,” Kathy Lien, managing director of foreign-exchange strategy at BK Asset Management, said in a note late Tuesday.
The Dow Jones industrial average fell 113.64 points, or 0.55 percent, to close at 20,523.28, the S&P 500 fell 0.3 percent dropped 6.82 points, or 0.29 percent, to end at 2,342.19 and the Nasdaq pulled back 7.32 points, or 0.12 percent, to close at 5,849.47.
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—By CNBC.Com’s Leslie Shaffer; Follow her on Twitter @LeslieShaffer1