Driven by chipmakers like Samsung Electronics and SK Hynix, South Korea's KOSPI surged more than 4% above 6,950.
Despite concerns over a Bank of Japan rate hike, tech shares increased, and Japan's Nikkei 225 rose 1.85% above 66,200.
The Shanghai Composite dropped 0.24%, while the Shenzhen Component increased by more than 2%, causing a divide in the Chinese markets.
Monday's strong bias in Asian markets was fueled by hopes that a new OpenAI model could increase demand for memory chips. This momentum came after US semiconductor and memory stocks rose on Friday as overall attitude about the industry strengthened.
With increases in Samsung Electronics, SK Hynix, SK Square, and Hyundai Motor, South Korea's benchmark KOSPI surged for a third straight day, rising more than 4% to the top 6,950. Strong economic fundamentals supported the surge, as South Korea's exports surpassed its 2025 total to reach a record $709.4 billion year-to-date, driven by a 169.6% increase in semiconductor shipments from January to August.
Following IT giants like Kioxia Holdings and SoftBank Group, the Nikkei 225 in Japan surged 1.85% above 66,200, while the Topix increased 0.48% above 4,100, extending advances for a second day. To counteract sticky inflation and currency weakness, traders are pricing in a possible September rate hike by the Bank of Japan, although sentiment is still cautious.
The Shanghai Composite fell 0.24% approaching 3,920 while the Shenzhen Component surged more than 2% above 13,800, giving Chinese markets a mixed image. China announced a CNY 300 billion ($45 billion) infusion into its major financial institutions, the largest sector recapitalization in almost 20 years, to support lending growth and stabilize balance sheets. In the meantime, shares in the financial, technology, and energy sectors caused Hong Kong's Hang Seng Index to drop by about 1% to almost 25,400.
However, after positive US jobs data reaffirmed expectations of a rate hike by the Federal Reserve this month, global markets continued to be cautious. Nonfarm payrolls increased by 162,000 in August, well exceeding the projection of 56,000. In the meantime, annual salary growth slowed less than expected to 3.1%, while the unemployment rate remained stable at 4.1%. With the CME FedWatch tool showing a 58.3% probability of a 25-basis-point Fed rate increase in September, traders quickly priced in tighter monetary policy in response to these numbers.
Following a geopolitical escalation between the US and Iran over the weekend, rising crude oil prices have heightened concerns of renewed inflationary pressures, prompting traders to exercise caution as well. Tehran created a new restricted area outside the Strait of Hormuz after the US bombed three Iranian tankers in retaliation for missile assaults on its warships, intensifying the crisis.
Despite concerns over a Bank of Japan rate hike, tech shares increased, and Japan's Nikkei 225 rose 1.85% above 66,200.
The Shanghai Composite dropped 0.24%, while the Shenzhen Component increased by more than 2%, causing a divide in the Chinese markets.
Monday's strong bias in Asian markets was fueled by hopes that a new OpenAI model could increase demand for memory chips. This momentum came after US semiconductor and memory stocks rose on Friday as overall attitude about the industry strengthened.
With increases in Samsung Electronics, SK Hynix, SK Square, and Hyundai Motor, South Korea's benchmark KOSPI surged for a third straight day, rising more than 4% to the top 6,950. Strong economic fundamentals supported the surge, as South Korea's exports surpassed its 2025 total to reach a record $709.4 billion year-to-date, driven by a 169.6% increase in semiconductor shipments from January to August.
Following IT giants like Kioxia Holdings and SoftBank Group, the Nikkei 225 in Japan surged 1.85% above 66,200, while the Topix increased 0.48% above 4,100, extending advances for a second day. To counteract sticky inflation and currency weakness, traders are pricing in a possible September rate hike by the Bank of Japan, although sentiment is still cautious.
The Shanghai Composite fell 0.24% approaching 3,920 while the Shenzhen Component surged more than 2% above 13,800, giving Chinese markets a mixed image. China announced a CNY 300 billion ($45 billion) infusion into its major financial institutions, the largest sector recapitalization in almost 20 years, to support lending growth and stabilize balance sheets. In the meantime, shares in the financial, technology, and energy sectors caused Hong Kong's Hang Seng Index to drop by about 1% to almost 25,400.
However, after positive US jobs data reaffirmed expectations of a rate hike by the Federal Reserve this month, global markets continued to be cautious. Nonfarm payrolls increased by 162,000 in August, well exceeding the projection of 56,000. In the meantime, annual salary growth slowed less than expected to 3.1%, while the unemployment rate remained stable at 4.1%. With the CME FedWatch tool showing a 58.3% probability of a 25-basis-point Fed rate increase in September, traders quickly priced in tighter monetary policy in response to these numbers.
Following a geopolitical escalation between the US and Iran over the weekend, rising crude oil prices have heightened concerns of renewed inflationary pressures, prompting traders to exercise caution as well. Tehran created a new restricted area outside the Strait of Hormuz after the US bombed three Iranian tankers in retaliation for missile assaults on its warships, intensifying the crisis.
