- Asian stock markets opened lower due to selling pressure on semiconductor shares and AI stock concerns
- South Korea's Kospi fell 5.07%, Japan's Nikkei dropped 2.55%, while Australia's ASX 200 rose 0.07%
- US stocks closed higher with Dow up 0.3%, S&P 500 up 0.4%, and Nasdaq rising 0.6% overnight
Asian stock markets opened lower on Thursday as another round of selling in semiconductor shares weighed on sentiment, prompting investors to reassess whether the artificial intelligence-driven rally in technology stocks can be sustained.
South Korea's Kospi dropped 5.07%, while Japan's Nikkei 225 fell 2.55%. Australia's ASX 200 bucked the regional trend, edging up 0.07%.
The weakness came despite a positive finish on Wall Street overnight. The Dow Jones Industrial Average rose 0.3%, while the S&P 500 gained 0.4% and the Nasdaq Composite added 0.6%. U.S. equity futures were little changed in early Asian trade, with Dow futures up 15 points, S&P 500 futures rising 0.05% and Nasdaq-100 futures advancing 0.11%.
Investors are balancing signs of easing inflation in the United States against mounting geopolitical risks in the Middle East. Although recent inflation data has reduced expectations of near-term Federal Reserve interest-rate increases, escalating tensions in the Persian Gulf have renewed concerns about energy supplies and the outlook for inflation.
Crude oil extended its recent rally after the United States carried out fresh strikes on Iran, heightening fears that the conflict could further disrupt crude shipments from the region. Brent crude climbed for a fourth consecutive session to trade above $85 a barrel.
The renewed hostilities have also cast doubt over the interim peace agreement signed by Washington and Tehran about a month ago. The arrangement has largely unravelled amid growing disputes over control of the Strait of Hormuz, a strategic shipping route used by Saudi Arabia, Qatar, the United Arab Emirates and other Gulf producers to export most of their crude.
The latest military action followed U.S. President Donald Trump's pledge to intensify strikes until Iran stops targeting commercial vessels in the Strait of Hormuz and agrees to keep the waterway open.
Market participants are also assessing whether a strong corporate earnings season can revive confidence in artificial intelligence-linked companies after sharp swings in semiconductor stocks exposed lingering concerns over elevated valuations in the sector.
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