Asia stocks rally as SK Hynix earnings boost AI trade; Fed decision ahead
Investing.com– Asian stocks rallied on Wednesday, led by South Korean shares after chipmaker SK Hynix reported a sharp increase in quarterly profit, bolstering optimism over artificial intelligence demand.
Investors’ focus was also on the U.S. Federal Reserve’s interest rate decision later in the day and earnings from major technology companies.
The gains followed an advance on Wall Street overnight, where technology shares led the market higher.
U.S. stock index futures were mixed in Asian trading Wednesday by 03:02 GMT, with tech-heavy Nasdaq futures leading gains.
S.Korea shares surge on SK Hynix-driven gains
South Korea’s KOSPI surged more than 6% in early trade, hitting its highest in two weeks.
SK Hynix (KS:000660) shares surged nearly 9% after the chipmaker reported a 631% jump in third-quarter operating profit, supported by strong demand for memory chips used in AI applications.
The company also announced an additional 60 trillion won in shareholder returns, adding to investor enthusiasm.
Shares of Samsung Electronics (KS:005930), another major supplier of memory chips, also advanced more than 8%.
The rally in AI-related shares has been reinforced by a series of funding announcements and Anthropic‘s filing for an initial public offering, reviving enthusiasm for the sector after concerns about the cost of building data centres and the sustainability of AI investment weighed on sentiment.
Investors were now looking for quarterly results from Alphabet (NASDAQ:GOOGL) and Microsoft (NASDAQ:MSFT), due after the U.S. market close, for evidence that heavy spending on AI infrastructure is translating into durable revenue growth.
In Japan, the Nikkei 225 rose 1.5%, while the broader TOPIX traded unchanged. Chipmakers led gains, with Kioxia Holdings (TYO:285A) shares surging over 12%, and Taiyo Yuden (TYO:6976) jumping more than 8%.
China’s Shanghai Composite and the blue-chip CSI 300 rose 0.7% each, while Hong Kong’s Hang Seng index edged up 0.3%.
Fed decision ahead; RBNZ rate hold, Australia CPI in focus
Elsewhere, moves were largely subdued as investors were cautious ahead of the Fed’s policy announcement later on Wednesday, with interest rates widely expected to remain unchanged.
Markets will scrutinise policymakers’ guidance for clues on the outlook for borrowing costs, particularly as persistent inflation and elevated oil prices complicate the policy outlook.
Australia’s S&P/ASX 200 ticked up 0.1% after data showed underlying inflation accelerating more than expected in the third quarter, bolstering the case for a Reserve Bank of Australia rate hike next week.
New Zealand’s NZX 50 edged 0.2% higher after the Reserve Bank of New Zealand unexpectedly kept rates unchanged.
Singapore’s Straits Times Index gained 0.2%, while futures tied to India’s Nifty 50 traded flat.
Oil prices also rose, with Brent crude above $115 a barrel, adding to concerns that energy costs could sustain inflationary pressure and constrain central banks’ room to ease policy.
