Asian stocks climb after Wall Street AI rally

Investors in Asia traded in a cautious but positive mood on Tuesday, buoyed by a one-day recovery in U.S. equities that erased previous weekly losses. The movement was driven largely by technology stocks, which had been volatile due to rising borrowing costs for artificial intelligence infrastructure. Traders in the region focused on corporate earnings and policy signals that could clarify the sustainability of the current AI spending cycle.

South Korea’s Kospi index recorded the day’s largest gain, rising more than 4 percent before settling at 5,667.99 by midday. The surge was propelled by semiconductor manufacturers, with SK Hynix shares climbing 7 percent and Samsung Electronics adding 4.8 percent. In Japan, the Nikkei 225 increased 2.2 percent to reach 63,542.77. Advantest, a maker of testing equipment, saw shares jump more than 10 percent, while SoftBank Group, an investor in OpenAI, rose 7 percent.

Mixed results appeared in other parts of Asia. Hong Kong’s Hang Seng index reversed its early session gains to finish 0.2 percent lower at 23,174.44. The Shanghai Composite slipped 0.1 percent to 3,692.58 as markets monitored a closed-door plenum of China’s Communist Party for economic policy announcements. Taiwan’s Taiex index gained 0.5 percent, and Australia’s S&P/ASX 200 rose 0.3 percent to 8,838.10.

The preceding trading session in New York saw the S&P 500 rise 0.7 percent, moving within 1.8 percent of its all-time high. Nvidia led the advance, gaining 2.4 percent and helping the chipmaker end a three-week losing streak. This performance followed a period of uncertainty in the AI sector, where stocks wavered amid concerns that high interest rates were making it expensive for companies to finance data centers and hardware purchases.

Corporate announcements continued to influence market sentiment. Meta Platforms disclosed plans to raise $35 billion through a stock sale to fund AI investments. The company noted that Nvidia, Advanced Micro Devices, and Broadcom have indicated they may purchase up to $5 billion of the new shares. Meanwhile, Anthropic released details on its financial losses as it prepares for a public stock offering, and SpaceX announced a $40 billion deal with an Apollo Global Management entity to lease AI computing power.

This week brings a heavy slate of earnings reports from major technology companies. Alphabet and Microsoft are scheduled to release their quarterly results on Wednesday, followed by Amazon on Thursday. Approximately one-third of S&P 500 companies will report earnings during the current week, offering investors a broad look at how AI spending is translating into revenue.

In the bond market, the yield on the 10-year U.S. Treasury fell to 4.98 percent from 5.00 percent late Friday. The two-year yield, which reflects expectations for Federal Reserve policy, rose to 4.71 percent. The central bank is widely expected to hold its federal funds rate steady when it concludes its meeting on Wednesday. The Fed raised rates last month for the first time in three years to combat persistent inflation. In other markets, Brent crude oil dropped 0.8 percent to $109.82 per barrel, while the dollar strengthened against the Japanese yen.