In a significant milestone for Asian markets, both South Korean and Japanese stock indices reached record highs on Wednesday, buoyed by a tech-driven rally on Wall Street. This surge comes amid easing fears surrounding potential disruptions in industries due to advancements in artificial intelligence.
The Nikkei 225 in Japan surged over 1.4%, marking a fresh peak, while the broader Topix index experienced a modest increase of 0.3%. Similarly, South Korea’s Kospi index soared by 1.72%, breaking through the psychological 6,000 mark for the first time, with major contributors like SK Hynix and Samsung Electronics rising by 0.6% and 0.88% respectively. The small-cap Kosdaq also saw gains, climbing 0.16% during the session.
Other regional markets also demonstrated positive performance. Australia’s S&P/ASX 200 rose by 1.13%, and the Hong Kong Hang Seng index increased by 0.39%. On the mainland, the CSI 300 index added 0.49%, while Taiwan’s benchmark experienced a notable rise of 1.8%, achieving a record high for the fifth consecutive session. Cryptocurrencies also spiked, with Bitcoin rebounding approximately 2% to hover around $65,000 after a brief dip below $63,000 earlier.
According to a report from BMI, the global economy seems to be stabilizing as the impacts of fiscal and monetary policies take hold, although financial markets have been navigating through various headwinds. The report highlights the turbulent effects of AI developments and ongoing geopolitical risks, particularly concerning Iran. Analysts indicated a 50% probability of a US-led military action against Iran, which could be contributing to an increased risk premium in oil prices, thus strengthening the US dollar.
Amid these dynamics, attention is also on U.S. President Donald Trump’s recent State of the Union address, where he discussed ongoing negotiations and expressed a preference for resolving nuclear concerns through diplomacy.
In the oil market, West Texas Intermediate crude futures increased by 0.72% to $66.10 per barrel, while Brent Crude was up 0.73% to reach $71.29 per barrel.
Overnight, U.S. equities showcased robust performance, led by substantial gains in Advanced Micro Devices (AMD) and various software stocks. AMD shares surged by 8.8% following the announcement of a multi-year partnership with Meta Platforms, which involves deploying extensive AMD graphics processing units in AI data centers. Meta will also consider a performance-based investment in AMD through warrants for up to 160 million shares.
This announcement followed last week’s revelation that Meta is incorporating millions of Nvidia chips in its data center expansion. In the U.S., the S&P 500 index rose by 0.77% to close at 6,890.07, while the Nasdaq Composite increased by 1.04% to settle at 22,863.68. The Dow Jones Industrial Average gained 370.44 points, or 0.76%, finishing at 49,174.50, thanks to nearly a 2% rise in Home Depot shares after the company posted earnings above expectations for the first time in a year. Following concerns related to AI, IBM shares, which experienced a slump previously, contributed to the Dow’s upward movement on the day.
