HONG KONG – Global equity markets delivered a mixed performance on Monday, with Asian benchmarks diverging as Japan and South Korea extended record-setting rallies driven by artificial intelligence optimism, while oil prices eased amid signs of progress in U.S.–Iran negotiations, according to market data and diplomatic updates reported from Hong Kong and international trading sessions.
The benchmark Nikkei 225 surged 1.6% to a record close of 72,353.96, while South Korea’s KOSPI rose 0.7% to 9,114.55, also marking an all-time high. Both indexes have climbed sharply in recent months, supported by sustained investor enthusiasm for AI-related technology stocks.
U.S. futures traded lower, reflecting cautious sentiment as markets weighed geopolitical developments alongside upcoming inflation data, including the Federal Reserve’s preferred personal consumption expenditures (PCE) index due later this week.
Technology and AI Drive Japan and Korea to New Peaks
In Tokyo, gains were led by technology and semiconductor-linked companies as investors continued to position for long-term AI demand.
SoftBank Group rose 1.9%, while chip equipment maker Tokyo Electron advanced 3.2%.
In Seoul, memory chip producer SK Hynix jumped 5.6%, reinforcing the sector-wide momentum across AI-linked supply chains.
The Nikkei 225 and Kospi have both recorded extraordinary gains over the past six months, rising more than 40% and 120% respectively, underscoring the scale of the technology-driven rally.
Neil Newman, managing director and head of strategy at Astris Advisory Japan, said market conditions remained strong but warned valuations were becoming stretched. “We’re seeing another strong market today,” he noted, adding that the Japanese market is “probably getting a little stretched” given geopolitical risks in the Middle East.
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Regional Markets Show Mixed Performance
Elsewhere in Asia, performance was uneven. Hong Kong’s Hong Kong Hang Seng Index slipped 0.6% to 23,785.50, while mainland China’s Shanghai Composite Index gained 1.8% to 4,163.10.
Australia’s S&P/ASX 200 edged down 0.1% to 8,816.10, while Taiwan’s Taiwan Taiex rose 2.8%. India’s Sensex added 0.4%.
The divergence highlighted investor sensitivity to both global technology momentum and geopolitical risk factors.
Oil Prices Ease on Iran Negotiation Optimism
Energy markets moved lower as diplomatic discussions between the United States and Iran showed early signs of progress.
Brent crude, the international benchmark, declined 1.1% to $79.70 per barrel, easing from higher levels seen during recent geopolitical tensions.
High-level talks held in Switzerland between U.S. and Iranian representatives concluded early Monday, with technical discussions expected to continue through the week. Mediators Qatar and Pakistan described the negotiations as showing “encouraging progress.”
However, uncertainty remains over energy supply routes. Iranian authorities stated the Strait of Hormuz was closed again over the weekend, while U.S. officials indicated that maritime traffic had continued. The conflicting accounts underscore ongoing risks to one of the world’s most critical oil shipping corridors.
ING commodities strategists Warren Patterson and Ewa Manthey warned that “moving towards a more permanent deal will be challenging, with very real risks of a flare-up in hostilities.”
Thomas Mathews, head of Markets Asia Pacific at Capital Economics, said energy flows were likely to recover only gradually, noting that attention is now focused on how quickly tanker traffic returns to the region.
Currency and U.S. Economic Focus
In foreign exchange markets, the U.S. dollar strengthened to 161.76 Japanese yen from 161.22 yen, while the euro eased to $1.1445 from $1.1473.
Investors are also awaiting the upcoming release of the U.S. PCE inflation index, a key indicator for Federal Reserve policy expectations, which is expected to shape broader risk sentiment across global markets later in the week.
Tags: Asian Markets, AI Rally, Stock Indices, Nikkei 225, KOSPI, Oil Prices, Iran Talks, Semiconductor Stocks, Global Economy, Currency Markets
