South Korea's KOSPI Slips as Tech Rally Pauses; Asia Awaits Fed Speech

Most Asian stock markets traded within a narrow range on Friday, as investors paused after a recent technology-led rally and awaited key signals on U.S. monetary policy. South Korea's KOSPI was a notable underperformer, weighed down by its heavyweight semiconductor stocks.

Tech Sector Retreats Ahead of Fed Cues

South Korea’s KOSPI index was the region's biggest loser, falling 1.02% as the enthusiasm following Nvidia's strong earnings report faded. The retreat was led by major chipmakers:

• SK Hynix and Samsung Electronics shares fell between 1.5% and 2.5%.

While the sector initially gained on optimism for AI-driven memory demand, concerns over high valuations and the sector's sensitivity to interest rates resurfaced. The caution comes ahead of a pivotal speech by the U.S. Federal Reserve Chair at the Jackson Hole Symposium.

Regional Markets Show Divergent Performance

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Elsewhere in Asia, performance was mixed. Japanese markets outperformed their peers, with the Nikkei 225 and TOPIX indices rising 0.86% and 0.85%, respectively. The gains followed the release of Tokyo's consumer price index data for August, which met expectations and reinforced bets that the Bank of Japan may soon move to raise interest rates.

Chinese markets were largely subdued, with the Shanghai Shenzhen CSI 300 down 0.16% while the Shanghai Composite edged up 0.03%. In Australia, the ASX 200 gained 0.4%.

Jackson Hole Symposium in Focus

The cautious mood across markets reflects investor focus on the annual economic symposium in Jackson Hole. A speech by the Federal Reserve Chair is the main event, with market participants looking for any new indications on the future direction of U.S. interest rates.

This sentiment was mirrored in the U.S. overnight session, where Wall Street benchmarks finished mostly flat despite an initial rally in tech stocks. U.S. stock futures remained muted during Asian trading hours, underscoring the broad-based wait-and-see approach among investors.