Technology stocks drives gains in Asian markets
Date
1/30/2025 3:21:02 AM
(MENAFN) technology Stocks drove gains in Asian markets on Wednesday, reflecting Wall Street's rallies. Investors were concerned about the emergence of a low-cost Chinese AI model from DeepSec, which some analysts view as a potential competitor to U.S. dominance in the AI sector. The dollar remained strong as traders moved away from safe-haven currencies like the Japanese yen, receiving an additional boost from new tariff warnings issued by the Trump administration.
Trading activity in Asia was subdued due to the Lunar New Year holidays, with stock exchanges in mainland China, Hong Kong, Taiwan, Singapore, and South Korea closed. Japan's Nikkei Index rose by 1%, ending a three-day losing streak. Australia's benchmark index gained 0.6%, while the technology sub-index surged by 1.8%. U.S. S&P 500 futures saw a 0.2% increase, following a 0.9% rise in the previous session’s cash index, while Nasdaq futures were up 0.4% after a 2% jump in the last session.
The Nasdaq had fallen over 3% in the previous session due to concerns over the increasing popularity of DeepSec's AI app, which raised doubts about the high valuations of U.S. chipmakers, particularly Nvidia. Kyle Rodda, a senior analyst at Capital.com, mentioned that while DeepSec’s AI model seemed impressive, it might lack the scalability to disrupt the AI market, and its low-cost model could potentially increase demand for GPUs. Attention is now focused on earnings reports from major tech companies, including Meta, Microsoft, and Tesla, later in the day. The Federal Reserve is also set to announce its monetary policy decision, with expectations that interest rates will remain unchanged.
The dollar index, which measures the U.S. dollar against six major currencies, ended at 107.91, after a 0.2% gain over two consecutive days. The index had dropped 0.6% last week, as traders considered Trump's tariffs less severe than expected. However, the White House confirmed plans to impose tariffs on Canada and Mexico, and Trump has hinted at additional tariffs on China. The Mexican peso strengthened slightly to 20.5169 per dollar, while the Canadian dollar also saw modest gains at 1.4394 CAD per USD. The Chinese yuan increased by 0.2% in offshore trading to 7.2597 per U.S. dollar.
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