Enthusiasm for tech shares propelled Asian stocks upward for a second consecutive day, as escalating tensions in the Middle East pushed Brent crude oil prices back above $92 per barrel. The Japanese yen faced renewed pressure as the region's markets responded to global economic shifts.
Tech stocks in Asia experienced significant gains, mirroring the overnight surge on the Nasdaq. Tokyo's Nikkei 225 climbed almost two percent, while Seoul's semiconductor-heavy market soared by 5.4 percent. This rise comes despite ongoing concerns about the sustainability of the artificial intelligence boom and whether tech sector valuations are overinflated.
Stephen Innes at SPI Asset Management noted that during the early phase of the AI stock boom, companies were rewarded for announcing larger investment plans. However, he questioned whether these increased spending guides would support chip demand or raise concerns about free cash flow and funding needs.
Investors are closely watching upcoming earnings reports from major tech companies, including Tesla and Google parent Alphabet, for further clues about the sector's health. Other tech giants like Microsoft, Meta, Apple, and Amazon are set to release their results next week.
Brent crude oil prices rose around one percent to over $92, the highest intraday price since June 11, following comments from President Donald Trump indicating continued U.S. military action against Iran. The U.S. military has conducted 11 consecutive nights of strikes aimed at degrading Iran's ability to threaten commercial shipping in the Strait of Hormuz.
On the currency markets, the Japanese yen continued to weaken, falling below 163 against the dollar—its lowest level since 1986. This decline is partly attributed to the rising oil prices and ongoing geopolitical tensions.
