AI Rally Lifts South Korea, Japan and Taiwan Stocks to Record Highs as South Asia Lags

A display board shows the closing levels of South Korea’s Kospi and Kosdaq at Hana Bank’s dealing room in central Seoul after the Kospi topped 6,600 for the first time on April 27. [Photo=Yonhap]

Asian stock markets moved in different directions as expectations for artificial intelligence helped lift Northeast Asia to fresh records despite the fallout from the Iran war, while South and Southeast Asia stayed under pressure from higher oil prices.

Northeast Asian benchmarks have risen since the war began on Feb. 28, Bloomberg News reported. Taiwan’s Taiex gained 9.9% through April 24. Over the same period, South Korea’s Kospi rose 3.7%, Japan’s Nikkei 225 added 1.5% and China’s CSI 300 climbed 1.25%. The CSI 300 tracks the 300 largest stocks by market value listed in Shanghai and Shenzhen.

By contrast, India’s Nifty 50 fell 5.8%, Indonesia’s Jakarta Composite Index dropped 10.4% and the Philippines’ PSEi slid 9.5%. The MSCI ASEAN Index was down 7.5%.

Bloomberg Intelligence strategist Marvin Chen said the key difference was AI. “In terms of oil, Korea, Taiwan and Japan are all highly dependent,” he said, “but what ultimately made the difference was AI.”

Bloomberg said the global semiconductor supply chain — including Taiwan Semiconductor Manufacturing Co., Samsung Electronics and SK hynix — has benefited from the AI boom, and demand tied to AI appears relatively insulated from geopolitical risks.

The split was evident in Monday’s trading. South Korea’s Kospi jumped 139.40 points, or 2.15%, to 6,615.03, closing above 6,600 for the first time. Japan’s Nikkei 225 rose 1.38% to 60,537.36, ending above 60,000 for the first time. Taiwan’s Taiex gained 1.76% to 39,616.63 for a second straight record close; it also hit an intraday high of 40,194.92, topping 40,000 for the first time.

The gains were attributed to renewed AI investment optimism ahead of earnings from U.S. big tech companies, along with expectations that tensions in the Middle East could ease. Semiconductor shares led: SK hynix touched 1,317,000 won intraday for a new 52-week high, Samsung Electronics rose 1.82%, and TSMC surged 3.66% to a record.

In India and Southeast Asia, rising crude prices have weighed broadly on economies, stoking inflation, worsening current accounts and weakening currencies, while also limiting policymakers’ room to respond.

South Korea, despite the stock rally, showed relative weakness in currency moves. Since the war began, the Chinese yuan has risen 0.5% against the dollar, while the Korean won has fallen 2.7%, one of the larger declines among major Asian currencies.

Gary Tan, a portfolio manager at Allspring Global Investments, said the divergence reflects “a collision between long-term, technology-driven structural change and short-term, war-driven macroeconomic shocks,” adding that Asia has become the central stage where the opposing forces meet.

* This article has been translated by AI.

Hwang Jin Hyun