Precise Investors Editorial Team
Kospi Index surged 3.7% to enter a technical bull market as a rebound in the artificial intelligence trade fuelled a reversal from July’s sell-off
Asian stocks rose as technology shares rallied, while Brent snapped a six-day rally. MSCI’s Asia-Pacific equity index gained 0.8%, with chipmakers Samsung Electronics and SK Hynix the biggest contributors.
Kospi Index surged 3.7% to enter a technical bull market as a rebound in the artificial intelligence trade fuelled a reversal from July’s sell-off.
Topix added 0.5%, S&P/ASX 200 dropped 0.6%, Hang Seng was little changed and the Shanghai Composite advanced 0.5%.
The good thing is that we have managed to digest the historical unwind in the momentum trade, Arun Sai, senior multi-asset strategist at Pictet Asset Management, said on Bloomberg TV.
We are in the early innings of the capex buildout. We are going to have a cycle around it. We have digested a fair bit of uncertainty in the AI ecosystem, he said.
Elsewhere, Brent declined 1.2% to under $88 a barrel.
Bonds in Australia and New Zealand also advanced.
Asian investors are returning to a familiar strategy: long Korea, short Hong Kong. That theme was briefly abandoned during the Kospi’s violent July sell-off. But August has brought a sharp reversal, said Mark Cranfield, Markets Live strategist.
Attention was also on the yen as it traded around the key level of 160 per US dollar, keeping investors on the lookout for more intervention by officials in the foreign exchange market.
The yen was little changed at 159.31 per US dollar after ending the previous session 0.1% weaker.
The currency has depreciated more than 1% in August, unwinding some of the efforts to strengthen it at the turn of the month.
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