BENGALURU: Emerging Asian equities rallied on Tuesday, led by technology shares in South Korea and Taiwan, as falling oil prices after US President Donald Trump’s comments on Iran boosted risk appetite following last week’s selloff.
Trump said on Monday he was unlikely to order new military strikes on Iran after appeals from countries including Qatar, sending oil prices to their lowest level since early September.
The drop in crude oil prices eased concerns over energy costs across import-dependent Asian economies, where a conflict-driven surge in oil prices had stoked inflation and prompted tighter monetary policy.
Improving sentiment triggered a rebound in tech stocks, with South Korea’s KOSPI closing 4.4 percent higher. Taiwan shares rose 2.5 percent, extending gains from the previous session after the activation of the government’s USD15 billion market stabilisation fund. The index has risen more than 7 percent over the past two sessions.
Chipmakers led gains. Samsung Electronics jumped 4.5 percent and SK Hynix soared 7.2 percent in Seoul, while index heavyweight TSMC lifted the Taipei market.
Both markets fell sharply last week on concerns that a Democratic sweep in the US midterm elections could lead to tighter regulation of AI investments and infrastructure, sparking a selloff in technology shares.
Markets are awaiting US inflation data due later in the day, with a stronger-than-expected reading likely to reinforce expectations that the Federal Reserve will raise interest rates again next month.
Surging borrowing costs worldwide threaten to hamper AI-related capital spending, as technology companies have relied heavily on debt and equity markets to fund infrastructure expansion.