TOKYO – Early Tuesday saw a mixed performance in Asian stock markets, as the optimism driven by a record-setting surge on Wall Street contended with growing concerns over rising oil prices and the potential for an artificial intelligence (AI) bubble.
Japan’s Nikkei 225 benchmark index rose by 0.7% to reach 62,881.03, reflecting some degree of positive sentiment. However, in South Korea, the Kospi index fell by 1.2% to 7,726.30, a decline analysts attribute to a heavy reliance on AI prospects that might not be sustainable.
Stephen Innes, an analyst with SPI Asset Management, commented on the situation, noting that “global equities remain dangerously dependent on a small group of AI leaders.” He suggested that while the rally looks robust on the surface, it is becoming increasingly unstable underneath.
Innes also pointed out that South Korea could be one of the first major economies to experience what he termed “the political redistribution phase of the AI boom.”
Elsewhere in the region, Australia’s S&P/ASX 200 slipped 0.3% to 8,676.60, while Hong Kong’s Hang Seng managed a modest gain of 0.2% to 26,467.50. Conversely, the Shanghai Composite index fell by 0.4% to 4,208.00.
Adding to the economic uncertainty, oil prices continued their upward trend amid the ongoing conflict involving Iran. U.S. crude rose by 91 cents, reaching $98.98 per barrel, while Brent crude, the global benchmark, increased by 90 cents to $105.11 per barrel.
Adding to worries were comments from President Donald Trump that the U.S.-Iran ceasefire was on “life support” after rejecting Iran’s latest proposal to end their war. That raises the stakes for Trump’s trip this week to China. China is the biggest buyer of Iran’s sanctioned crude oil.
The war has already sent the price for a barrel of Brent racing up from prewar levels of roughly $70 and delivered inflation through the global economy. The war has shut the Strait of Hormuz and kept oil tankers stuck in the Persian Gulf instead of delivering crude to customers worldwide.
Still, some companies are reporting bigger profit than analysts expected, which means the U.S. economy is holding up even though households are feeling discouraged by expensive gasoline and tariffs.
On Wall Street, the S&P 500 rose 0.2% from its prior all-time high set on Friday. The Dow Jones Industrial Average gained 95 points, or 0.2%, and the Nasdaq composite added 0.1% to reach its own all-time high.
All told, the S&P 500 rose 13.91 points to 7,412.84. The Dow Jones Industrial Average added 95.31 to 49,704.47, and the Nasdaq composite gained 27.05 to 26,274.13.
In the bond market, Treasury yields ticked higher. The 10-year yield rose to 4.40% from 4.38% late Friday.
In currency trading, the U.S. dollar rose to 157.57 Japanese yen from 157.12 yen. The euro cost $1.1761, down from $1.1787.
___
AP Business Writer Stan Choe contributed to this report.
Yuri Kageyama is on Threads:
