Asia stocks subdued as Nvidia earnings loom over AI-fuelled rally

By Roshan Thomas

Nov 19 (Reuters) - Taiwan and South Korean stocks fell on Wednesday, while currencies were little changed as investors awaited Nvidia's earnings to gauge the next phase of the AI-driven market rally.

Taiwan stocks .TWII shed 0.4% while South Korean shares swung between gains and losses. The KOSPI .KS11 was last down 0.5%, a day after tumbling more than 3% and closing below the key 4,000 level. It dropped over 2.5% earlier in the session.

Losses in major tech stocks weighed, as Samsung Electronics 005930.KS dropped 3.3% and SK Hynix 000660.KS declined 4.2%. LG Energy Solution 373220.KS eased 3.3%.

The market's focus has shifted to AI-darling Nvidia's NVDA.O results later in the day, a key test of sentiment at the heart of the AI boom that may set the next direction for markets.

Nvidia, which supplies graphics processing units, or GPUs, behind modern AI systems, has been a key driver of a global market rally that pushed equities to record highs and lifted stocks even loosely tied to the AI theme.

"For Nvidia, this is the most important set of quarterly results from the company because of the critical juncture that the artificial intelligence complex happens to find itself in," said Kyle Rodda, a senior financial market analyst at Capital.com.

Elsewhere, equities in Thailand .SETI inched 0.2% lower, while Philippine stocks .PSI edged 0.1% higher.

Meanwhile in Indonesia, the central bank is expected to keep its key rate unchanged later in the day to contain pressure on the rupiah IDR=, as it urges commercial banks to lower lending rates and evaluates the impact of past monetary policy easing on the economy.

Bank Indonesia has cut its benchmark rate by 150 basis points since September last year but the country's banks have passed on only 15 basis points of that reduction to borrowers this year.

"The central bank will lean towards a pause due to a weaker currency and correction in risk assets, whilst pushing for faster policy transmission," analysts at DBS said in a note.

"In the interim, the central bank is likely to encourage faster policy transmission and undertake macroprudential measures to lower the effective lending rate."

Stocks .JKSE were up 0.6% ahead of the decision, while the rupiah, the worst performer among its peers, was little changed.

The South Korean won KRW=KFTC slipped 0.3% against a steady U.S. dollar index =USD.

The Philippine peso PHP= and the Thai baht THB=TH each edged 0.1% and 0.2% lower, while the Singapore dollar SGD= and Taiwan dollar TWD=TP were little changed.

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