Asia-Pacific stock markets continue their rally, aiming for the best February in history; Korea’s stock index rises 18% for the month, but tech stocks are under pressure following Nvidia’s earnings report.

Asia-Pacific stock markets continue their rally, aiming for the best February in history; Korea’s stock index rises 18% for the month, but tech stocks are under pressure following Nvidia’s earnings report.

February 27—Asian stock markets are heading for their best-performing February ever. Investors have been aggressively buying companies in the region that provide infrastructure for artificial intelligence (AI), driving this record-breaking surge. Despite a slight uptick today, the MSCI Asia-Pacific Index has risen 6.3% this month. This is the best February performance since the index was launched in 1998. It is also set to outperform the S&P 500 for a third consecutive month. U.S. stock index futures fell on Friday, signaling further declines for Wall Street’s benchmark. South Korea, seen as a bellwether for AI investment, is the top-performing market in Asia. The KOSPI Index surged about 18% this month and has soared 46% year-to-date, making it the best-performing benchmark globally. Asian stock markets have outperformed European and American benchmarks as investors flock to companies supporting AI infrastructure expansion, viewing these businesses as the "pick-and-shovel sellers" in the supply chain. By contrast, this new technology’s disruptive potential has been unsettling U.S. industry stocks for weeks, a phenomenon called “AI panic trading.” Global asset managers with over $20 trillion under management are increasingly bullish on emerging market equities, currencies, domestic bonds, and credits, which could provide fresh momentum for the sector’s record gains. Citigroup Inc. has reviewed outlooks from some of the world’s largest asset managers and found funds have increased long positions in Asia, Latin America, and Europe, Middle East, and Africa markets. This comes as MSCI’s main emerging market equity index is also nearing all-time highs. - **MSCI Asia-Pacific Index edged up 0.15% today, up 6.3% for the month.** The KOSPI Index rose about 18% this month, up 46% year-to-date. - **S&P 500 futures fell 0.4%. Topix in Japan gained 0.4%.** Euro Stoxx 50 futures were little changed. - **U.S. Treasuries held gains,** with 10-year yields hovering around 4%. Australian 10-year yields fell 5 basis points to 4.65%. - **Dollar index barely changed.** The euro was steady versus the dollar at $1.1794. The yen rose 0.1% to 155.95 per dollar. **Offshore yuan fell 0.2%** to 6.8575 per dollar. - **Spot gold rose 0.2%,** to $5,192.81/oz. Gold’s February gain exceeded 6%, heading for a seventh consecutive monthly rise and set to break the longest monthly winning streak since 1973. - **Bitcoin** dipped slightly to $67,288.68. Ethereum dropped to $2,018.49. - **WTI crude** slipped 0.4% to $64.98 per barrel. ## Nvidia results “fail to ease AI anxiety,” tech stocks pressured On Friday, tech was the worst performing sector in Asia after Wall Street’s benchmark fell, with sentiment dampened by a muted reaction to Nvidia’s earnings. Hardika Singh of Fundstrat Global Advisors commented that the market’s calm response to Nvidia (despite revenue, net income, and guidance beating expectations) partially reflects investors’ growing accustomed to such strong results. “But it failed to allay investor concerns about Nvidia’s shrinking moat in the rapidly evolving computing world and didn’t clarify its game plan in the disruptive AI landscape—disruption that could impact everything from cybersecurity to food delivery to banking,” she said. [Image omitted] [Image omitted] ## AI news continues to dominate after-hours trading Meanwhile, even after New York’s closing bell, AI-related news continued to impact the markets. Jack Dorsey’s payment giant Block Inc. soared over 20% in after-hours trading after news broke it would cut nearly half its workforce (around 4,000 jobs) to pivot toward AI. Dell Technologies’ shares also jumped after the company’s outlook for AI server sales exceeded expectations. [Image omitted] ## Other asset performance: Gold keeps climbing, U.S. yields hit yearly lows Elsewhere in the markets, U.S. Treasuries held gains, with 10-year yields hovering near 4%. During U.S. trading, yields hit the lowest point this year. Early Friday, Australian 10-year yields fell 5 basis points to 4.65%. The dollar was volatile. [Image omitted] After a round of discussions Thursday, the U.S. and Iran agreed to more nuclear talks next week, steadying oil prices. With U.S. troops heavily deployed in the Middle East, the market remains tense. [Image omitted] Moreover, gold is on track for its longest monthly rally since 1973, with February’s gain of over 6% marking a seventh straight monthly advance. [Image omitted] In Japan, Tokyo’s core inflation slowed to its lowest level in more than a year, as Prime Minister Sanae Takaichi’s utility subsidies curbed household energy costs. The yen strengthened slightly on Friday. [Image omitted] Risk disclaimer Markets involve risk; investment requires caution. This article does not constitute personal investment advice and does not take into account individual users’ unique investment goals, financial status, or needs. Users should consider whether any opinions, views, or conclusions herein suit their specific circumstances. Investment based on this article is at your own risk.