Japan, South Korea Chipmakers Slip Post‑AI Rally

Asian equity markets eased on Monday, with the Nikkei 225 slipping 0.3% and the KOSPI falling 0.5% after a week‑long AI‑driven rally. Nasdaq 100 Futures rose 0.7% and S&P 500 Futures gained 0.3% in Asian trade, following softer‑than‑expected U.S. payroll data that lowered expectations for further Federal Reserve rate hikes this year. Regional indices showed mixed moves: Hong Kong’s Hang Seng rose 0.9%, Indonesia’s Jakarta Composite added 0.8%, Malaysia’s KLCI up 0.2%, and India’s Nifty 50 gained 0.7%; the Shanghai‑Shenzhen CSI 300 and Shanghai Composite each eased 0.6%.

Semiconductor stocks led the declines: Samsung Electronics Co Ltd fell 0.9%, SK Hynix Inc dropped 4.3%, and MediaTek Inc slipped 1.4%. Nvidia’s primary AI‑server assembler, Hon Hai Precision Industry Co Ltd (Foxconn), bucked the trend, gaining 0.6% after reporting record June and second‑quarter revenue driven by strong AI server demand. Taiwan Semiconductor Manufacturing Co. edged up 0.6%, while the broader Taiwan Weighted index was essentially flat.

Bank of America said the recent pull‑back in AI‑related equities appears to be a positioning reset rather than a sign of weakening fundamentals, noting that spending on AI infrastructure remains supported.

Oil prices stayed under pressure after OPEC+ announced an additional production increase for August, building on earlier output hikes and reinforcing expectations of ample global supply. The easing of geopolitical tensions following a cease‑fire between Israel and Iran helped underpin broader risk sentiment despite the semiconductor weakness.

DBS expects Malaysia’s central bank to leave its policy rate unchanged, while inflation data from Thailand, China, Taiwan and the Philippines will be closely watched. The Reserve Bank of New Zealand is widely forecast to raise its benchmark cash rate by 25 basis points to 2.50% at its Wednesday meeting, its first hike since mid‑2023. Taiwan’s June trade figures will be examined for further evidence of AI‑driven export demand. Investors await the Federal Reserve’s June meeting minutes on Wednesday and remarks from Fed Governor Christopher Waller and New York Fed President John Williams later in the week.