Asian Markets Rise on AI, Tech Rally Ahead of U.S. Earnings and Fed Decision

Asian stock markets traded mostly higher on Wednesday, lifted by strong momentum in technology and AI-related shares as investors positioned ahead of key earnings from U.S. megacap companies. Optimism surrounding artificial intelligence demand and solid corporate results helped offset caution in some markets before the Federal Reserve’s interest rate announcement later in the day.

Sentiment in Asia followed Wall Street’s record-breaking run, where the S&P 500 reached fresh highs and the Nasdaq continued its upward streak. U.S. stock index futures also pointed higher, with Nasdaq futures rising about 0.6% in late trading, reinforcing confidence across global markets.

AI Optimism and Wall Street Strength Boost Asian Sentiment

Regional bourses drew support from renewed enthusiasm for AI-driven growth and resilient corporate earnings in the United States. Technology stocks, especially those tied to semiconductors and data centers, led gains as investors anticipated upbeat guidance from major U.S. technology firms.

The earnings spotlight is firmly on companies such as Microsoft, Meta Platforms, and Tesla, which are set to report results later in the day, while Apple is due to release its earnings on Thursday. Markets are closely watching for evidence of sustained revenue growth from AI services and continued capital spending on data infrastructure.

South Korea and Hong Kong Lead Gains

Asian markets broadly echoed the positive mood, with tech-heavy sectors outperforming.

South Korea’s KOSPI climbed as much as 2%, powered by gains in major chipmakers. Samsung Electronics advanced around 1.5%, while SK Hynix jumped about 5%, reflecting strong demand expectations for high-end memory chips used in AI applications.

Hong Kong markets also saw solid buying interest. The Hang Seng Index surged roughly 2.4%, while the Hang Seng TECH sub-index rose 1.5%, supported by renewed investor confidence in technology and internet stocks.

In mainland China, benchmarks posted moderate gains. The CSI 300 and Shanghai Composite index both added about 0.5%, while futures linked to India’s Nifty 50 edged 0.3% higher, pointing to a cautiously positive open.

Fed Decision in Spotlight as Rate Outlook Guides Markets

Investors remained focused on the Federal Reserve, which is widely expected to keep interest rates unchanged. However, market attention is centered on the policy statement and comments from Chair Jerome Powell for hints on when potential rate cuts could begin later this year.

Any change in tone could significantly influence risk appetite, bond yields, and currency movements across Asia. A more dovish outlook would likely support equities, especially growth and technology stocks, while a cautious stance could trigger renewed volatility.

Japan and Regional Markets Weighed by Currency Pressures

Not all Asian markets shared in the rally. Singapore’s FTSE Straits Times Index slipped 0.5%, and Australia’s S&P/ASX 200 edged 0.2% lower as investors remained selective.

Japan underperformed, with the Nikkei 225 falling about 0.6% and TOPIX dropping 1%. The declines were driven by a stronger yen, which traded near its highest level in around three months amid speculation of possible U.S.–Japan foreign exchange intervention.

A firmer yen typically weighs on Japan’s export-oriented companies, as it makes goods more expensive overseas and reduces the value of foreign earnings when converted back into yen.