Asian equity markets moved unevenly on Thursday. Tokyo and Seoul hit fresh peaks amid shifts in interest-rate expectations and a renewed wave of enthusiasm for chipmakers tied to Nvidia's latest earnings, while several other regional markets either steadied or pulled back after recent rallies.
Wall Street's strong close the night before provided constructive momentum for parts of the region, particularly technology stocks that had rallied ahead of Nvidia's earnings release. However, S&P 500 futures were down 0.1% by 22:37 ET (03:37 GMT) as Nvidia Corporation (NVDA) pared initial gains and traded slightly lower in after-hours trade. The chip designer did report earnings and guidance that topped consensus, but the market reaction reflected lingering questions about inventory levels and sales in China.
South Korea leads gains as Nvidia catalysts boost chip suppliers
Seoul's benchmark was the standout performer in Asia on Thursday. The KOSPI climbed more than 2% to a record 6,222.14 points, marking the index's best showing for the day. The move was led by substantial rallies in major memory-chip manufacturers with business tied to Nvidia's demand for advanced components.
Samsung Electronics Co Ltd (005930.KS) and SK Hynix Inc (000660.KS) both rose to record levels, reflecting investor enthusiasm that Nvidia's results signal sustained AI-driven demand. Those two firms - important suppliers of memory chips within Nvidia's supply chain - were the largest contributors to the KOSPI's advance.
Other local developments supported the rally. Samsung unveiled its new flagship S26 smartphone line on Wednesday, and SK Hynix announced plans to invest 21.6 trillion won, equivalent to $15.07 billion, to build a new production facility in South Korea. The Bank of Korea's decision to keep interest rates unchanged, as widely expected, combined with an upgraded growth outlook helped underpin optimism about the nation's chipmaking sector.
Japan's benchmarks climb as rate-hike expectations cool
Japan's Nikkei 225 and TOPIX indexes extended their recent gains and rose to record highs on Thursday. The advance followed Tokyo's nomination of two academics perceived as dovish to the Bank of Japan, a development that intensified skepticism over the central bank's intent to push interest rates higher.
The softer outlook for future rate moves weighed on the yen, offering support to exporters and lifting Japan's large export-oriented companies. Still, gains were not uniform across Japanese markets. Technology stocks, particularly domestic chipmakers that had rallied ahead of Nvidia's earnings, experienced pullbacks on profit-taking, trimming some of the intraday upside in the Nikkei.
Market attention now turns to consumer inflation figures from Tokyo, scheduled for release on Friday. Further evidence of cooling inflation could reinforce the recent easing in expectations for additional BOJ rate increases.
Mixed performance elsewhere in the region
Outside Japan and South Korea, performance across Asia varied. Australia's ASX 200 climbed 0.5% and reached a record high amid continued strength in mining and bank stocks. By contrast, China's mainland markets - including the Shanghai Shenzhen CSI 300 and the Shanghai Composite - eased slightly, pausing after two sessions of sharp gains that were driven by hopes for higher consumer spending during the Lunar New Year holidays.
Hong Kong's Hang Seng index fell 0.5% as local technology names cooled after earlier gains. Internet giant Baidu Inc (9888.HK) dropped 2.6% ahead of its fourth-quarter earnings, with market focus on whether the company's heavy investments in AI are translating into tangible results.
Other regional moves included Singapore's Straits Times index slipping 0.2% and Thailand's SET Index jumping 0.8% following an unexpected 25 basis point reduction in the country's central bank policy rate on Wednesday. India's Nifty 50 was higher, rising 0.3% in morning trade.
What investors are watching
- Follow-through in chipmaker shares across Asia, particularly those linked to Nvidia's supply chain.
- Tokyo consumer inflation data due Friday, which could influence expectations for further moves by the Bank of Japan.
- Company-specific earnings, including Baidu's upcoming results, which are drawing attention for signs that large AI investments are producing returns.