Asia Market Wrap 2 September: 9 of 10 gauges fall as the Kospi drops 3.99 percent

By The Edge Research Team

Asian equity markets fell almost without exception on Wednesday 2 September 2026. Of the 10 gauges tracked here, covering 8 markets, 9 closed lower and 1 closed higher. The Kospi lost 3.99 percent, the steepest fall in the group, and the Nikkei 225 lost 2.85 percent. The Straits Times Index was the only gainer, at plus 0.59 percent.

The 8 headline benchmarks averaged a decline of 1.32 percent, against a decline of 0.03 percent on Tuesday. That is a swing of 1.29 percentage points in a single session. The spread between the best and worst of those 8 widened from 2.71 percentage points on Tuesday to 4.58 percentage points, so the market did not merely fall, it fell unevenly.

Reuters attributed the move across regions to renewed United States strikes on Iran, which lifted crude prices and revived inflation concerns, extending a global government bond selloff. Fed funds futures implied a 68 percent probability of a 25 basis point increase at the Federal Reserve meeting on 16 September, against 37 percent a week earlier, on CME Group’s FedWatch measure. That is a 31 percentage point repricing inside 7 days.

The ranking inverted at both ends

Tuesday’s best performer became one of Wednesday’s weakest, and 2 of Tuesday’s 3 weakest gauges improved. The Taiex rose 1.78 percent on Tuesday and fell 1.67 percent on Wednesday, a reversal of 3.45 percentage points. The Kospi swung from plus 0.23 percent to minus 3.99 percent, a move of 4.22 percentage points and the largest single gauge change in the set. Against that, the Hang Seng improved from minus 0.93 percent to minus 0.07 percent and the Straits Times from minus 0.78 percent to plus 0.59 percent. Taken together, 8 of the 10 gauges were worse on Wednesday than on Tuesday and 2 were better.

South Korea

The Kospi closed at 6,562.72, down 273.08 points, ending a 2 session run of gains. Yonhap News Agency reported that foreign investors sold a net 1.9 trillion won and institutions a net 2 trillion won, while individual investors bought a net 2.3 trillion won. Losing issues outnumbered gainers 734 to 137. Samsung Electronics fell 4.02 percent and SK hynix 4.73 percent, but the sharpest declines were outside semiconductors: Hyundai Motor lost 5.62 percent, LG Energy Solution 5.31 percent and POSCO Future M 8.00 percent.

Lee Kyung-min of Daishin Securities told the agency that “the KOSPI went bearish as investor sentiment was dragged down by rising oil prices and sovereign debt yields in major economies.”

South Korea’s consumer price index rose 3.1 percent in the year to August, published on 2 September, accelerating from 2.8 percent in July. Petroleum products rose 14.2 percent and contributed 0.54 percentage points, which is about 17 percent of the headline rate and leaves 2.56 percentage points coming from everything else. Core inflation ran at 3.4 percent, above the headline rate and the highest since May 2023. An energy shock alone does not produce a core reading above the headline. That said, part of the breadth is arithmetic rather than demand: mobile telephone service charges rose 26.7 percent against a low base created by discounts a year earlier. The August print records price pressure that has moved beyond fuel, with the qualification that one large base effect sits inside the non fuel component.

Japan

The Nikkei 225 closed at 64,325.64 and the Topix at 4,081.60, down 2.85 percent and 2.40 percent. On Tuesday the 2 gauges moved in opposite directions; on Wednesday they did not.

Two hawkish Bank of Japan policy signals landed the same day. Board member Hajime Takata, speaking in Sapporo, argued that rate increases should be made “on a meeting-by-meeting basis in response to evolving economic and price conditions” rather than at a fixed semiannual pace, and described 2026 as a significant turning point. Asked about the 10 year Japanese government bond yield reaching 3 percent, he said the move “largely reflected a broader global rise in interest rates” and warned that divergence between Japanese and overseas policy could drive volatility in currency markets. Governor Kazuo Ueda separately restated that the bank would continue raising rates. The Bank of Japan’s policy meeting concludes on 18 September.

Taiwan

The Taiex closed at 46,164.72, at the day’s low, on turnover of 918.39 billion New Taiwan dollars against 1.19 trillion on Tuesday. Foreign institutional investors sold a net 91.35 billion New Taiwan dollars, on Taiwan Stock Exchange data. The electronics sub index fell 2.06 percent.

The concentration is worth stating precisely. Taiwan Semiconductor Manufacturing Company fell 2.25 percent and accounted for about 440 of the index’s 784 point decline, which is 56 percent of the fall from a single constituent. MediaTek, which rose 10 percent on Tuesday after Nvidia announced a 3.5 billion dollar investment, gave back only 0.93 percent. Tuesday’s specific corporate news held; what reversed was the market around it. Old economy names rose against the trend, with Formosa Petrochemical up 2.61 percent and the financial sector up 0.45 percent.

Combining the 2 disclosed figures, foreign investors were net sellers of roughly 4.27 billion dollars of Korean and Taiwanese shares on the day, using each market’s own reported net selling and Wednesday’s quoted exchange rates. This is reported net equity selling on 2 exchanges, not a measure of total cross border capital flows.

Australia

The Australian Bureau of Statistics reported June quarter gross domestic product up 0.4 percent on the quarter and 2.1 percent on the year, against 0.3 percent in the March quarter. Net trade added 0.1 percentage points. The terms of trade fell 1.6 percent and the household saving ratio rose to 6.5 percent from 6.4 percent. The bureau linked domestic price growth to rising input costs as oil prices rose. The S&P/ASX 200 closed down 0.97 percent.

Bonds

The bond selloff that began earlier in the week continued. Reuters reported the 10 year Japanese government bond yield at 3.01 percent, a 30 year high, the 10 year United States Treasury yield at a near 3 year high of 4.81 percent and the Australian 10 year at 5.198 percent, the highest in more than 15 years. Korean yields moved with them: the 10 year treasury bond closed at 4.418 percent, 4.7 basis points higher on the day, on Yonhap’s daily bond table.

The dollar moved in 2 directions at once

The dollar index rose 0.16 percent, but it did not gain against everything. Of the currencies shown here it rose against the euro, which fell 0.19 percent, and sterling, which fell 0.27 percent, while the yen gained 0.20 percent and the Korean won firmed 1.7 to 1,368.7 per dollar, a gain of 0.12 percent. Both Asian currencies covered here strengthened against the dollar on a day when their equity markets fell hard, which is not the pattern a general flight from Asian assets would produce.

Closing index levels for the 2 September 2026 session, captured at 10:18 GMT after every Asian market had closed, ranked by change. The Shanghai Composite and the S&P/ASX 200 both round to minus 0.97 percent and are ranked on their unrounded values. The 8 headline market benchmarks referred to above are the Nikkei 225, Shanghai Composite, Hang Seng, Kospi, Nifty 50, S&P/ASX 200, Taiex and Straits Times; the Topix and the Shenzhen Component are additional gauges for markets already counted. Each close matched the previous day’s closing level carried by the same feed for all 10 gauges, against the levels published in this series for 1 September. The Straits Times level is a vendor quote and is provisional. Singapore Exchange and the index administrator had not published a dated record for 2 September 2026 at the time of writing, and the quote is subject to amendment against that record. It was stable and unchanged across 2 reads 41 minutes apart, timestamped after the Singapore closing routine, and its level equals the day’s high, which is the pattern a closing auction print produces.

Quotes captured at 10:18 GMT on 2 September 2026, before the day’s settlement windows. These are intraday levels, not exchange settlements. Each change is measured against the previous session’s exchange settlement, so it is settlement to snapshot rather than settlement to settlement. The 5 NYMEX and COMEX bases were checked against CME Group’s published settlements for trade date 1 September 2026 and matched on every contract: WTI 90.22, natural gas 2.90400, gold 4,396.40, silver 65.369 and copper 6.6005. Silver is quoted on the December contract, which carried 87,781 lots of open interest against 2,627 in October at the 31 August settlement, per CME Group.

Intraday quotes from the same 10:18 GMT capture on 2 September 2026, measured against each instrument’s previous close. A fall in dollar/yen is a stronger yen.

Elsewhere, Most Recent Completed Sessions

Middle Eastern markets trade Sunday to Thursday and Wednesday’s regional set was incomplete at this capture. Continental European exchanges had been open for several hours but had not completed Wednesday’s session, and United States markets had not yet opened. All 3 tables below therefore carry Tuesday 1 September, the most recently completed session in each region.

Middle East, 1 September close, for reference

Closing levels carried from this series’ Middle East wrap for the 1 September 2026 session, each taken from its own exchange, ranked by change. Egypt led the regional board that day while Saudi Arabia, Dubai and Abu Dhabi finished lower. The Saudi reading was taken only after that exchange’s market status label had moved past the closing auction.

Europe, 1 September close, for reference

Closing levels carried from this series’ Europe wrap for the 1 September 2026 session, ranked by change. The FTSE 100 change is measured against Friday 28 August because London was closed on Monday for the Summer Bank Holiday. The DAX level was published as a vendor quote of the Xetra close because Deutsche Boerse had not then posted its dated price history row. That row has since published and gives the close as 25,970.11, confirming the level carried in that report.

Commodities, 1 September settlements, for reference

Settlements for trade date 1 September 2026. The West Texas Intermediate, gold and silver figures are NYMEX and COMEX settlements from CME Group, read after that exchange published its settlement file. Brent is an ICE contract and its settlement is the level reported by Reuters. These are settlement to settlement changes and supersede the intraday snapshot levels carried in this series’ commodities report for that date, which were captured before the settlement file was available.

Sources: Yonhap News Agency, the Kospi close and investor flows, the August consumer price index and the daily Korean bond table, 2 September 2026; Central News Agency, the Taiex close, turnover, foreign institutional net selling and constituent moves, 2 September 2026; Australian Bureau of Statistics, Australian National Accounts for the June quarter 2026, 2 September 2026; Reuters, the global market wrap, the sovereign bond selloff, the Bank of Japan comments of Hajime Takata and Kazuo Ueda, and the Fed funds futures probability, 2 September 2026; CME Group, the FedWatch measure, the settlement file for trade date 1 September 2026 and silver open interest; Deutsche Boerse, the dated DAX price history row for 1 September 2026; CNBC, index, commodity and currency quotes captured at 10:18 GMT on 2 September 2026; The Edge, the Asia, Middle East, Europe and Commodities Market Wraps covering the 1 September 2026 session.

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