Most Asian stocks rose on Wednesday, supported by strong technological gains and the growing emergence of artificial intelligence companies, ahead of the upcoming reporting dates for several of the largest U.S. companies. The overall gain was countered by the level of caution seen in certain markets before the announcement of the Federal Reserve’s interest rate decision. Following the rise into record territory of the S&P 500 and increased returns from Nasdaq stocks in recent trading sessions, Asian stock markets were buoyed by Wall Street’s recent strong performance, driven by expectations of strong corporate earnings and the potential future impacts of ongoing AI demand. As of 22:20 ET (03:20 GMT), U.S. stock index futures were also at higher prices, with the tech-laden Nasdaq at a rise of 0.6%.
Asian stock markets reflected the optimism, with semiconductors and data center-related stocks surging. Apple Inc. (NASDAQ: AAPL) is scheduled to publish results on Thursday, while Microsoft Corporation (NASDAQ: MSFT), Meta Platforms Inc. (NASDAQ: META), and Tesla Inc. (NASDAQ: TSLA) will post results later in the day on Wednesday’s U.S. earnings calendar.
The markets are keeping an eye out for indications of long-term AI-related revenue growth and trends in capital expenditures. With SK Hynix jumping 5% and Samsung rising 1.5%, South Korea’s KOSPI increased by up to 2%. The Hang Seng in Hong Kong increased 2.4%, while the Hang Seng TECH sub-index increased 1.5%.
The Shanghai Composite index and the blue-chip Shanghai Shenzhen CSI 300 both saw 0.5% increases in mainland China. Futures linked to the Nifty 50 index in India saw a 0.3% increase.
The Fed, which is generally anticipated to maintain interest rates steady later on Wednesday, was also a major focus of the market.
Any change in guidance is expected to have an impact on risk appetite and currency markets throughout Asia, so traders are keeping an eye on the policy statement and Chair Jerome Powell’s comments for hints on the timing of possible rate cuts later this year.
Australia’s S&P/ASX 200 fell 0.2%, while Singapore’s FTSE Straits Times Index slipped 0.5%, defying the regional trend.
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The Nikkei 225 in Tokyo eased 0.6%, while the TOPIX fell 1%, under pressure from a strong yen that was trading close to its highest levels in almost three months due to rumours of potential foreign exchange intervention by the United States and Japan.
Sharp increases in AI-related companies, such as Renesas Electronics Corp (TYO:6723) and tech investor SoftBank (TYO:9984), stopped further losses in Japan.
Japan’s export-heavy benchmark is under pressure to decline as a result of a stronger yen, which raises the price of Japanese goods internationally and can lower foreign profits when repatriated.
Hence, the strong AI and tech-powered gains increase the confidence among investors. However, the upcoming Fed guidance and earnings reports are also important in shaping the market directions.
