Asian stock markets experienced a rally, driven primarily by enthusiasm for artificial intelligence. MSCI Inc.'s gauge of Asian shares increased by 0.9%, marking a fifth consecutive day of gains. South Korea's Kospi Index jumped 1.5-1.6%, and Taiwan's stock benchmark reached an intraday record. This uplift was significantly influenced by the success of Meta Platforms Inc.'s new AI agent, which fueled a rally in chipmakers like Samsung Electronics Co. and SK Hynix Inc. on Monday, and subsequent strong demand. Alibaba Group Holding Ltd. further boosted sentiment on Tuesday by announcing its new AI chip, which it claims is China's most powerful, leading to a rally in its shares and those of Tencent Holdings Ltd.
Optimism in the AI sector was also evident in the US, where an index of semiconductor stocks rallied over 4% on Monday. Meta's stock surged 11%, and Advanced Micro Devices Inc. surpassed $1 trillion in market value. This renewed confidence follows earlier concerns about the rapid pace of AI development and calls for a slowdown. Analysts like Kyle Rodda from Capital.com highlighted Meta's AI chatbot as a meaningful catalyst, reinforcing demand in the AI ecosystem, especially for chips. Clive Maguchu of State Street Investment Management noted that such news continually reinforces the sustained demand for AI.
In other market movements, Brent crude oil rose about 0.9% to trade above $101 a barrel, after four consecutive sessions of decline, though it had briefly dipped below the key $100 level. West Texas Intermediate crude also gained 0.9% to $96.65 a barrel. Bitcoin saw a decline of about 1.5% after surging over 7% to climb above $87,000 in the previous session. The dollar firmed against other currencies, with the yen at 157.39 per US dollar, as investors anticipated further rate hikes from major central banks to combat inflation, reinforcing the dollar's strength.
