Market Overview

Asian equities traded mostly higher on Tuesday as investors cautiously returned to technology shares after the sharp AI‑driven rout that characterized July. The Australian S&P/ASX 200 outperformed regional peers, rising about 1%, while Japan’s Nikkei 225 and TOPIX each slipped 0.6%, and Hong Kong’s Hang Seng index fell 0.6%.

Index and Major Stock Moves

  • Dow Jones Industrial Average closed at a record high, buoyed by U.S. manufacturing activity expanding at its fastest pace in more than four years during July.
  • Nasdaq 100 Futures rose 0.4% and S&P 500 Futures added 0.2% in Asian trade.
  • Regional index snapshots: DJI +1.32%, AXJO +1.32%, JP225 -0.02%, HK50 -0.94%, MSFT +4.93%, GOOGL +4.88%, LCO +1.48%, ESU26 +0.23%, NQU26 +0.50%, NSEI -0.75%, KS11 +0.48%, STI +0.35%, SSEC +0.48%, TOPX -0.20%, 000660 -3.77%, 005930 -3.44%, 6758 -1.42%, 6762 -1.94%, 0981 +3.46%, 0700 -1.35%, CSI300 +1.35%, 6981 -2.42%, 000725 +3.51%, 002230 +0.82%, 002475 +2.48%, LTR +5.30%, EUR +8.65%, 1810 -1.43%, 601138 +5.33%, 9988 -0.08%, PLTR +2.10%, CXOXF +6.06%, 285A +3.36%.

Technology Sector Recovery

Chinese technology stocks rebounded after Monday’s sell‑off: Foxconn Industrial Internet jumped more than 4%, BOE Technology gained over 2%, SMIC added about 1.5%, iFlytek advanced 1.6%, and Luxshare Precision climbed 1.5%. In Hong Kong, Alibaba unveiled its largest AI model, Qwen3.8‑Max, which the company said outperformed Anthropic’s Fable 5 and Moonshot’s Kimi K3 on several benchmarks while offering substantially lower costs. Alibaba shares added roughly 0.7% after rallying more than 7% on Monday; Tencent slipped around 1% and Xiaomi fell over 2%.

South Korea and Japan

South Korea’s KOSPI trimmed early losses to trade 0.3% lower after tumbling more than 5% on Monday. Samsung Electronics was little changed, while SK Hynix edged up 0.4% as chipmakers stabilized following heavy selling. Citi analysts noted that the AI‑driven correction left positioning sharply divided across Asia, with the KOSPI remaining in deeply bearish territory and Hong Kong benefiting from short‑covering; sentiment could improve further if confidence in the AI theme stabilises.

Japan remained under pressure: the Nikkei 225 fell 0.6% and the TOPIX lost 0.6%. Kioxia Holdings gained nearly 3%, whereas Murata Manufacturing fell almost 3%; Sony and TDK also traded lower.

Australian Lithium Rally

Lithium miners drove the ASX 200’s outperformance. Pilbara Minerals rose more than 3%, Liontown Resources gained over 5%, Core Lithium advanced 5%, and European Lithium surged nearly 10%.

Macro and Policy Outlook

Attention turned to the Reserve Bank of India, widely expected to leave policy rates unchanged later on Wednesday; Nifty 50 futures were little changed after the benchmark index climbed 1.6% in the previous session. South Korea reported consumer inflation slowing to a three‑month low in July as lower oil prices eased price pressures, though markets still see the possibility of another rate increase later this month after the Bank of Korea’s surprise July hike.

Oil prices steadied after Monday’s decline, with Brent crude holding near three‑week lows as markets weighed U.S. President Donald Trump’s decision to delay fresh military action against Iran, while Tehran insisted no formal negotiations were underway.

Upcoming Events

Investors awaited earnings from SpaceX, Disney, Uber and Airbnb later in the week, alongside a string of U.S. labour‑market reports culminating in Friday’s non‑farm payrolls data, which are expected to provide fresh clues on the outlook for Federal Reserve policy and artificial‑intelligence spending.