Key Points
- South Korean stocks surge 3.6 per cent, its strongest daily gain since early September
- Japan’s Nikkei advances as semiconductor shares lead the recovery
- Investors focus on Big Tech earnings and central bank decisions
ISLAMABAD: Asian stock markets rallied on Tuesday, led by South Korean and Japanese shares, as renewed optimism about artificial intelligence (AI) investment lifted semiconductor stocks.
Overdue bullish rally followed Anthropic’s initial public offering (IPO) filing in the United States.
South Korea’s KOSPI surged 3.6 per cent, while Japan’s Nikkei 225 rose 1.7 per cent to 63,232.37, with chip-related companies leading gains.
The rebound followed a positive session on Wall Street, where technology shares advanced as investors reassessed concerns about the financing and profitability of AI infrastructure.
The gains came as investors prepared for quarterly results from major US technology companies and upcoming central bank decisions, both of which could influence global markets in the days ahead.
Chipmakers lead regional rally
South Korean semiconductor giants Samsung Electronics and SK Hynix benefited from renewed interest in companies supplying memory chips for AI systems and data centres.
In Japan, Tokyo Electron gained 4.5 per cent and Screen Holdings climbed 5.2 per cent, reflecting stronger demand for semiconductor-related stocks.
The Asian market recovery followed heightened concerns about the scale of spending required to develop AI infrastructure, including advanced chips, data centres and computing systems.
US futures and Asian stocks advance following a rally on Wall Street https://t.co/btZYXbeBPw https://t.co/HFEhKmuj3v
— The Independent (@Independent) October 27, 2026
Investors have questioned whether returns from these investments will justify the substantial capital commitments made by technology companies.
Anthropic’s IPO filing helped ease some of those concerns, encouraging investors to return to AI-linked shares. However, uncertainty remains over the sector’s long-term profitability and the cost of financing further expansion.
Asian markets drew support from Wall Street on Monday, as the S&P 500 rose 0.7 per cent, the Nasdaq Composite gained 0.8 per cent, and the Dow Jones Industrial Average advanced 0.3 per cent.
Tech stocks earnings in focus
Asian investors are now looking to Alphabet and Microsoft’ financial results on Wednesday, followed by Amazon on Thursday.
The anticipated positive results would reinforce the notion that AI spending is translating into sustainable revenue growth and profits.
The companies’ earnings and forecasts are expected to provide important clues about future AI infrastructure investment.
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Strong results could reinforce confidence in semiconductor manufacturers and other suppliers, while disappointing guidance could renew concerns about elevated valuations.
Asian market participants are also monitoring monetary policy developments in major economies. Interest-rate decisions and central bank guidance could affect borrowing costs, investment plans and valuations across the technology sector.
Higher financing costs could weigh on companies investing heavily in AI infrastructure. At the same time, sustained demand for advanced computing systems could support earnings and investment even in a challenging interest-rate environment.
Despite Tuesday’s Asian rally, investors remain cautious about the sustainability of the AI-driven stocks recovery.
Upcoming earnings reports and central bank decisions would determine whether the latest gains extend or give way to renewed volatility.
