Asian stock markets witnessed a widespread rally on Wednesday, primarily driven by a rebound in the technology sector and anticipation of upcoming earnings reports from major global tech companies. Investors took advantage of bargain opportunities in tech stocks following recent declines caused by disappointing earnings from chipmakers and concerns about persistently high interest rates.
Tech-heavy exchanges outperformed in Asia, with Japan’s Nikkei 225 index surging by 2%, while South Korea’s KOSPI jumped by 1.9%. Gains in prominent internet stocks lifted Hong Kong’s Hang Seng Index by 1.1%, which helped offset broader weakness in Chinese markets. Chinese electric vehicle stocks experienced modest gains, tracking the bounce in Tesla’s share price.
Optimism prevailed ahead of earnings releases from global tech giants Meta Platforms, Microsoft, and Alphabet, fueling hopes that positive results would justify the recent rise in tech valuations.
Asian chipmakers, including Renesas Electronics, Tokyo Electron, and Advantest, rebounded sharply, boosted by strong earnings from Texas Instruments and expectations for robust demand in the artificial intelligence sector. Strong earnings from Texas Instruments also contributed to optimism towards chipmakers.
Most broader Asian markets advanced on Wednesday, albeit at a slower pace. China’s Shanghai Shenzhen CSI 300 and Shanghai Composite traded slightly higher, lagging their peers amid renewed doubts about an economic recovery in the country. Australia’s ASX 200 added 0.3%, having trimmed a significant portion of its initial gains after data showed that consumer inflation grew more than expected in the first quarter. The reading gives the Reserve Bank of Australia more impetus to maintain higher interest rates for an extended period.
Japan’s broader TOPIX index rose by 1%, with export-oriented stocks benefiting from the yen’s weakness ahead of a Bank of Japan meeting this Friday. Futures for India’s NSEI index pointed towards a positive open, with the index remaining close to the record highs reached earlier in April.
