Stocks in the Asia-Pacific region declined on Tuesday, November 3, 2026, as investors monitored the start of voting in the U.S. midterm elections. While Asian markets faced downward pressure, oil prices stabilized following a drop during the previous session.
The market activity follows a period of tension in the Middle East and mixed earnings reports from major technology companies. On Monday, U.S. markets saw the S&P 500 fall 0.5%, influenced by Apple's forecast of lower gross margins for the holiday quarter due to rising memory-chip costs. Additionally, oil prices had tumbled more than 7% on Monday following reports of diplomatic talks between Iranian and Qatari officials, which Westpac analysts stated reduced the geopolitical risk premium.
In Asian trading on Tuesday, MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.9%, with South Korean shares declining by as much as 3.8%. Taiwan's market dropped 1.3%, while Hong Kong's Hang Seng Index rose 0.3%. In the commodities market, Brent crude was 0.1% lower at $104.72 per barrel. This stability followed a Wall Street Journal report on Monday that the U.S. military had struck Iran's Qeshm Island in the Strait of Hormuz.
For investors, the outcome of the midterms coincides with a quarterly refunding announcement from the U.S. Treasury, scheduled for Wednesday, November 4. This announcement will provide specific details on the scale of government debt issuance, which influences interest rates. On Tuesday, the 10-year Treasury bond yield stood at 4.913%. The scale of market movement suggests investors are preparing for potential volatility in these rates depending on the election results and the Treasury's borrowing needs.
In the currency and banking sectors, the People’s Bank of China announced on Tuesday that it will increase the foreign exchange deposit reserve ratio for financial institutions from 4% to 6%, effective November 15, 2026. Additionally, the Reserve Bank of Australia is widely expected to raise its cash rate target by 25 basis points to 4.85% at its meeting on Tuesday. Markets will receive further guidance as election results begin to clarify the U.S. political landscape throughout Wednesday.