As AI Strains Ease, Stocks Rise but Dollar Declines – Asia Market Wrap

A rebound in technology stocks that boosted Wall Street benchmarks spread to Asia, as concerns about the disruptive consequences of AI subsided following weeks of upheaval.

MSCI’s Asian stocks index rose 1.5% to a new high, while gauges in South Korea and Taiwan, both of which are leading indicators of AI investments, also reached new highs. A rally in battered software companies sent US benchmarks higher, ahead of Nvidia’s important earnings later Wednesday. At the start of trading, European shares were also expected to rise.

The Dollar dipped as much as 0.2%, while US equity-index futures lost the majority of their previous gains following Trump’s State of the Union address. Treasury yields dipped down, with the benchmark 10-year climbing 1bps to 4.04%. The Yuan rose, while Asian currencies rallied to a 16-month high, aided by a weaker Dollar.

Meanwhile, the Yen fluctuated as Japan’s PM Takaichi’s cabinet nominated two reflationist academics to the BoJ policy board on Wednesday. The appointment is expected to increase speculation that Takaichi will be wary of the central bank boosting interest rates soon.

Gold and silver, which have surged alongside stocks this year, gained ground. Bitcoin, too, has reduced some of its earlier gains, trading around $65,000.