Asia Stocks Hit Records on AI Momentum: Japan’s Nikkei, Taiwan Tech Rally, and the Fed-Cut Tailwind

Asian markets extended their advance as investors doubled down on the region’s AI supply chain and bet that a cooler U.S. inflation backdrop will unlock policy easing. Japan’s Nikkei 225 pushed to another all-time high, led by technology, energy, and utilities, while Taiwan’s benchmark also printed a record as chip leaders climbed. The day’s playbook was familiar but potent: when demand for AI compute spikes, the winners are the companies providing chips, equipment, interconnects—and the electricity that keeps hyperscale campuses running.
In Tokyo, animal spirits centered on SoftBank, which vaulted nearly 10% on renewed optimism around its AI ecosystem exposure. That move lit a fire under semiconductor-equipment names and power-grid operators that stand to benefit from multi-year data-center expansion. The message for allocators was clear: the AI build-out is migrating from a single-stock story to a platform trade touching power, utilities, and specialty materials alongside the usual chip champions.
Taipei told a parallel story. The main index gained about 1% to a record as buyers leaned into foundry scale and packaging leadership. Taiwan Semiconductor climbed on expectations that advanced processes and capacity additions will keep order books tight into year-end. While intraday breadth narrowed, the earnings narrative—accelerator demand, high-bandwidth memory, advanced substrate capacity—remains supportive enough to absorb bouts of macro noise.
Elsewhere, South Korea’s equities advanced as memory-cycle momentum and capex guidance from global hyperscalers buttressed the bull case. Onshore China saw blue chips firm while Hong Kong’s early weakness faded, leaving the region broadly risk-on even as investors remained selective around property-linked names. Cross-asset signals leaned supportive: gold hovered near records, crude slipped on signs of softer U.S. demand, and the dollar stayed range-bound as traders waited for the U.S. CPI print. That mix fits a soft-landing setup—lower real-yield pressure and still-solid earnings visibility in the sectors that matter for Asia.
For positioning, focus on three signals. First, breadth: sustained records in Japan and Taiwan will be healthier if participation widens beyond the front-rank AI winners to second-derivative plays—power infrastructure, grid upgrades, and materials. Second, real yields: if the U.S. 5- to 10-year real complex continues to ease, duration-sensitive tech should keep leadership; a back-up would test high-multiple software and hardware simultaneously. Third, earnings run-rate: watch monthly exports and capex updates across North Asia for proof that AI server demand is translating into shipments, not just narrative.
Bottom line: Asia’s rally is still anchored in tangible order books and capex plans, not just in sentiment. With Japan and Taiwan setting new highs and policy risk skewed toward gradual easing rather than tightening, the region retains a favorable asymmetry—upside if disinflation holds and AI spending persists, limited downside if domestic demand slows but external tech orders stay firm.