AI-Driven Tech Rally Lifts Wall Street and Spurs Asian Market Rebound

Buoyed by a strong tech-led rally on Wall Street, global risk sentiment has improved, driving a rebound in Asian equities during early trading. The market optimism stems largely from Meta’s new AI agent, which has boosted upbeat expectations for the AI industry and its upstream chip supply chain, leading major regional tech stocks to track their U.S. counterparts higher.

In terms of benchmark performance, the MSCI Asia Index rose 0.9%, on track to gain for five consecutive trading sessions. South Korean memory chip giants Samsung Electronics and SK Hynix emerged as the key contributors to the index’s advance. The KOSPI jumped 1.6%, while the Taiwan Weighted Index notched an intraday record high. U.S. markets also staged a strong comeback, with the S&P 500 and Nasdaq 100 both posting their best single-day performance since early August, and U.S. benchmark index futures edged slightly higher.

U.S. technology and semiconductor sectors saw explosive gains on Monday, with the Philadelphia Semiconductor Index surging more than 4%. Market confidence in the commercial potential of Meta’s new AI agent fueled expectations of soaring demand for high-end computing chips, significantly lifting valuations across the semiconductor sector. Meta’s stock skyrocketed 11%, AI chip leader AMD surpassed a $1 trillion market capitalization, and the Nasdaq 100 climbed 2.8%, positioning tech growth stocks as the primary focus of market capital inflows.

Commodity and cryptocurrency markets showed divergent trends. Brent crude stabilized near $100 per barrel after four straight days of losses, as supply concerns stemming from Middle East geopolitical tensions eased. Traders are closely monitoring evolving developments in U.S.-Iran relations to assess potential impacts on energy supplies. Bitcoin retreated around 1% after a volatile session; the cryptocurrency had surged more than 7% on Monday, breaking above $87,000 amid heightened risk appetite and capital inflows into risky assets.

The foreign exchange market traded muted overall. The U.S. dollar edged lower, the Japanese yen remained steady, and the South Korean won outperformed other regional currencies.

Middle East geopolitics remains a core focal point for global market participants, who are evaluating diplomatic efforts and increased Saudi oil exports to gauge downward pressure on crude prices. Satellite data indicates Saudi Arabia sharply ramped up crude oil loadings from its inland Persian Gulf facilities over the weekend, with vessel activity at the country’s key Persian Gulf ports hitting the highest level since June. The notable increase in oil supply has further eased market supply worries.

Key developments have emerged in international politics and policy. Donald Trump is scheduled to deliver a speech at the UN General Assembly on Tuesday evening and may hold a sideline meeting with Iranian President Masoud Pezeshkian. In addition, his administration has proposed a $5 billion fund to rebuild critical infrastructure across the Middle East damaged during the ongoing Iran-related conflicts, fueling market expectations for regional post-war reconstruction.

On U.S. monetary policy, Austan Goolsbee, President of the Federal Reserve Bank of Chicago, struck a cautious tone on inflation. Speaking at a London event on Monday, Goolsbee warned that persistent and recurring supply shocks cannot be ignored, and the central bank may need to take countermeasures even at the cost of economic headwinds. He noted that supply shocks have become more frequent, more forceful and longer-lasting, adding that traditional inflation analysis frameworks will no longer apply if supply-side disruptions exert sustained pressure on inflation.

Separately, Japanese markets remained closed for a public holiday.

[Disclaimer] Forex trading involves risk; please invest with caution. This content is for informational purposes and objective analysis only, and does not constitute any investment advice, basis for buying/selling, or guarantee of returns. Investors should make independent decisions based on their own financial situation and risk tolerance, and bear their own investment risks.