Asian stocks retreated on Wednesday as strength in the yen spurred a further unwinding in the carry trade, while losses in e-commerce major JD.com dragged down Hong Kong’s Hang Seng index.

U.S. stock index futures inched higher on Monday, with the markets focused on results from AI-darling Nvidia (NASDAQ:NVDA) and a key inflation report due later in the week, while investors remained optimistic about a September rate cut from the central bank.

The Japanese yen firmed sharply over the past month as the Bank of Japan began raising interest rates, sparking a rapid unwinding in the yen carry trade that had spurred strong capital flows into broader risk-driven markets. 

The dollar slipped to its lowest this year versus the euro on Wednesday as traders braced for potentially crucial revisions to U.S. payrolls data later in the day, ahead of a speech by Federal Reserve Chair Jerome Powell at the end of the week.

Most Asian stocks rose on Tuesday, tracking an overnight rally on Wall Street as markets cheered the prospect of lower U.S. interest rates before a key address from Federal Reserve Chair Jerome Powell later this week.

Walt Disney (NYSE:DIS) Animation Studios, in a significant leadership shift, on Thursday named Academy Award-winning filmmaker Jared Bush as its new chief creative officer, effective immediately.