Asian Markets Mixed as AI-Related Stocks Decline
Tech shares in Japan and South Korea fell, though gains in other sectors provided some counterbalance.
Asian stock markets experienced mixed trading on Monday, with declines in artificial intelligence-related shares impacting benchmarks in Japan and South Korea. These losses were partially offset by gains in other sectors.
In Japan, the Nikkei 225 index shed 1% to close at 68,704.70, following a 4.2% drop on Friday. SoftBank Group, an investment firm with a stake in OpenAI, saw its shares fall 5.9% after a 12.5% decline the previous day.
South Korea's Kospi lost 2% to 8,246.50, extending a trend that saw it down 5.8% on Friday. Samsung Electronics dropped 6%, and memory chipmaker SK Hynix fell 4.5%.
Markets in Taiwan, which have benefited from the global AI boom, saw the Taiex gain 1.1%. This recovery came after a 3.6% decline on Friday. Many Taiwanese tech companies, including chipmaker TSMC, are considered beneficiaries of AI development.
Japan and South Korea's markets had previously seen significant growth, driven by demand for computer chips and other components crucial for artificial intelligence. However, recent concerns over AI valuations have led to some of these gains being trimmed.
Elsewhere in Asia, Hong Kong's Hang Seng index rose 2.1% to 23,153.89, and the Shanghai Composite index in China edged 0.2% higher to 4,034.08. Australia's S&P/ASX 200 advanced 0.4% to 8,798.00, while India's Sensex remained largely unchanged.
On Friday, Wall Street also saw concerns over AI valuations, though major indices closed mixed. The S&P 500 lost less than 0.1%, the Nasdaq composite dropped 0.2%, and the Dow Jones Industrial Average fell 0.1%.
Several U.S. technology companies experienced share price drops. Micron Technology's shares declined 6.7%, Intel was down 3.4%, Nvidia fell 1.6%, and AMD (Advanced Micro Devices) dropped 2.1%.
In commodity markets, Brent crude, the international oil standard, was up 0.7% to $73.27 a barrel early Monday, remaining near pre-conflict levels. U.S. benchmark crude gained 0.8% to $70.02 a barrel.
Market strategists noted that risks persist for the oil market due to escalating tensions between the U.S. and Iran, particularly following recent drone and missile attacks. Concerns about the safety of shipping in the Strait of Hormuz have also resurfaced. Analysts suggested that oil traders might be overly optimistic about the speed of recovery in Persian Gulf supplies, leaving significant upside risk if supply recovery is slow or if tensions re-escalate.