Asian Chip and AI Stocks Surge on Strong US Tech Earnings

Asian technology stocks, particularly in the semiconductor and artificial intelligence sectors, rallied sharply on Friday, buoyed by a strong overnight performance on Wall Street and month-end portfolio adjustments by investors.

Broad-Based Regional Rally

The gains were widespread across the region's major technology hubs. South Korea's KOSPI index was a standout performer, surging over 18% on Friday, according to data from Investing.com. Component giants Samsung Electronics and SK Hynix jumped between 25% and 30%, recouping a substantial portion of their recent losses.

Other key markets saw similar strength:

• Japan's Nikkei 225 index climbed 4%, led by tech conglomerate Softbank Group (+14%) and Nvidia supplier Advantest (+15%).
• In Taiwan, the world's largest contract chipmaker, TSMC, saw its shares rise by 10%.
• Chinese AI stocks also participated, with Z.AI up 15.5% and Minimax rising 13% after releasing a new AI model.

Wall Street Catalysts

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The positive sentiment was largely imported from the U.S., where upbeat quarterly earnings from Microsoft and Amazon helped restore confidence in the AI-related trade. According to the source report, investors were encouraged that Microsoft did not raise its capital expenditure guidance, which eased concerns about potentially unsustainable AI spending.

Furthermore, Amazon reported strong June quarter earnings, demonstrating improving returns from its cloud and AI investments. These positive results helped the market look past less impressive reports from other major tech firms.

Context: Bargain Hunting After a Tough Month

Friday's rally also appeared to be driven by bargain hunting, as investors stepped in after the technology sector was battered by an extended sell-off through July. The preceding downturn was fueled by questions over high valuations and the impact of rising U.S. interest rates, which prompted widespread profit-taking.

Despite the monthly weakness, this week's earnings reports from key U.S. companies suggest that corporate spending on AI infrastructure and semiconductors is unlikely to slow in the coming quarters.