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BENGALURU: Equities in Asian emerging markets were under pressure on Thursday after lacklustre earnings from US tech firms triggered a broad sell-off among regional peers, with South Korean shares and the won hit further by a surprise contraction.

South Korean stocks were the biggest losers, diving more than 2%, weighed down by heavyweights Samsung Electronics and SK Hynix, which plunged 2.2% and 7.6% respectively.

Further driving the sell-off was data showing an unexpected shrinking of second-quarter growth in the East Asian economy, which prompted further outflows.

“While today’s weaker-than-anticipated out-turn raises the risk of an earlier Bank of Korea (BoK) move, we think other considerations, including a weak currency and rising house prices, will keep the BoK cautious,” Krystal Tan, Asia economist with ANZ, wrote in a note.

MSCI’s index of Asia emerging markets equities, among the top 10 constituents of which are Samsung Electronics and SK Hynix, slipped 0.9% to its lowest since mid-June.

The broader MSCI index of international emerging markets equities also fell to its lowest since mid-June.

Among macroeconomic data awaited on Friday were figures on second-quarter US economic growth and personal consumption expenditures (PCE) - the Fed’s favoured measure of inflation - to validate traders’ bets of interest rate cuts this year.

Futures now imply a 100% chance of a Federal Reserve easing in September.

“It remains to be seen whether recent regional (Asian) currency gains will be sustained, with US second quarter growth and core PCE data coming up next,” said Lloyd Chan, senior currency analyst at MUFG.

Asian currencies have steadied over the past few sessions as rising bets for two US rate cuts this year warm investor confidence in risk-sensitive emerging market assets.

The Indonesian rupiah slipped 0.4% to 16,266 per dollar, its lowest in two weeks, with equities declining 0.8% for a third successive day of losses.

In Singapore, the dollar hovered near its prior close, although equities were down 0.8% as financial stocks took a hit ahead of Friday’s monetary policy meeting.

Investor focus turns to the year’s third quarterly meeting of the Monetary Authority of Singapore that is widely expected to keep policy settings unchanged.

In a note last week, analysts at Barclays said they expected a hawkish statement to rein in inflation expectations.

“The latest monthly Consumer Price Index (CPI) prints continue to suggest underlying inflation pressures are still gradually easing but remain elevated – which likely continues to pose a significant bar for FX policy easing.”

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