Asian Shares Rise Following US Gains Fueled by AI Demand,Focus Shifts โฃto Economic Resilience
Asian shares are โคtrending upward following positive gains in US markets,driven largely by strong performance from companies linkedโค to artificial intelligence โ(AI). However, market optimism โคis broadening beyond high-profile tech names, with investors increasinglyโ focused on corporate resilience and theโข potential for renewed Federal Reserve interest rate cuts. This positive momentum faces a key test as earnings season begins.
According to Mark โHaefele at UBS Global Wealth Management, “With price-to-earnings ratios for today’s tech giants still wellโ below those of โthe tech firms at the peak of the dotcomโ bubble, we think the bull market remains intact.”
Nvidia Corp. spearheaded advances in US mega-cap โขstocks, with CEO Jensen Huang reporting “really, really” high demand for Blackwell chips.
Attention in Asia isโ now centered on China‘s economicโ performanceโ following the Golden Week holiday. Investors are evaluating whether renewed enthusiasm surrounding AI can offset indications of subdued consumer spending. Holiday spending data revealed a cautious approach from households, with more affordable road trips favored over flights โฃand box office sales falling short of expectations.
This weaker consumption trend coincidesโ with an AI surge that propelled global tech stocks โฃto new highs during China’s holiday period, spurred by companies highlighting connections to OpenAI.
The CSI 300 Index has experienced five consecutive months of gains through September – โits โlongest winning streak as 2017 – largely driven by optimism in the chip sector. This enthusiasm stems from DeepSeek’s unveiling of an updated AI model andโ Huawei Technologies Co.’s plans to double production of its leading AI chips. The index is currentlyโฃ up 18% for the year.
Geopolitical developments include โa statement fromโ Donald Trump indicating that both Israel and Hamas have agreed to terms for the release of all hostages held in Gaza, representing a significant breakthrough in US-brokered negotiations to end their two-year conflict.
Amid a relatively quiet economic calendar due โฃto the US government shutdown, investors analyzed the minutes from the latest Federal Reserve meeting.Officials demonstrated a willingness โฃto consider further rate cuts this year, but expressed caution due to ongoing โขinflation concerns. Bloomberg’s dollar index reached its highest โคlevel since August.
Luis Alvarado at Wells Fargo Investment Institute emphasized the Fed’sโค data-dependent approach, stating, “The Fed is clearly not on a preset path and data dependency is now more necessary than before, especially as officials attempt to โcalibrate โฃbetween conflicting goals.” He added, “We โคstillโ expect โtwoโ moreโฃ quarter-point rate cuts by the end โขof this year, and two more next year.”