Asian tech stocks rose sharply on Monday after heavy losses the week before. Markets in Japan, South Korea and Taiwan led the gains, IOL reported.
Taiwan’s TSMC jumped nearly 6%, which helped push the Taiex index up by 5%. Japan’s Nikkei 225 rose more than 3%, with Kioxia, Tokyo Electron and Advantest all gaining.
Sally Auld of National Australia Bank said investors would watch closely to see if the gains were “just short-covering, bargain hunting or the beginning of something more sustainable in nature”.
In South Korea, SK hynix and Samsung both gained around 3%. This pushed the Kospi index much higher. Hong Kong and Shanghai also posted good gains.
Not all markets went up. Sydney, Wellington and Manila ended slightly lower.
Auld said fears about AI rules, spending plans and free cash flow had made investors cut their risk in recent weeks. She said these issues were unlikely to be settled soon. “Nonetheless, the valuation of many tech stocks now looks less expensive,” she added.
Chipmakers and other AI companies fell hard after the US midterm elections on Tuesday. Democrats won both houses of Congress, a blow to President Donald Trump and his Republican Party.
According to the report, the results suggested voters were angry about the war with Iran and tariffs that pushed up prices. There was also a backlash against the fast growth of data centres across the US.
This led to talk that the new Congress may try to limit building by tech companies. That could put thousands of jobs at risk. Traders were already worried about when the huge sums put into AI would start making a profit.
Wall Street fell on Thursday but steadied towards the end of the week. Asian markets, which also dropped on Friday, mostly followed that recovery on Monday.
Nvidia added new worry to the market. Reports said its board was starting an investigation into whether chief executive Jensen Huang had been targeted in a foreign spying plot. This followed his admission that he had been unfaithful to his wife.
The New York Times reported last month that US intelligence officials believed a Chinese executive had been passing information to Beijing. The executive is linked to Megaspeed, a data centre company based in Singapore.
The Times reported that the executive, Alice Huang, also known as Huang Le, built a close relationship with the Nvidia boss. She is not related to the 63-year-old Jensen Huang, who was born in Taiwan.
Jensen Huang is an informal adviser to Trump. The Times reported that the alleged affair could have given insight into the president’s thinking on AI.
Nvidia makes chips used to train and run AI models. Last year it became the first company to reach a market value of $5 trillion.
Dan Ives, a technology analyst at Yorkville Ives, said the matter would at least lead to several inquiries in Congress. “This will add risk to the stock as he is so important to the Nvidia story and strategy globally,” Ives said.
Ives said it would also bring more scrutiny on selling chips to China, which he called a key issue in Washington.
Investors are also waiting for new US inflation data. Figures released on Friday showed the US economy created far more jobs than expected in October.
The Federal Reserve will use the data to decide whether to raise interest rates at its December meeting. Markets are pricing in an 80% chance of an increase.
Source: this article is based on reporting by IOL. Image: IOL. Written with the help of AI and published by the Tzaneen Voice Technology desk. See our Editorial Standards.
Werner Jacobs covers technology for Tzaneen Voice. Werner reports on mobile networks, data prices, internet access, smartphones, apps, AI, cybersecurity and South African tech companies. Each story explains what a new product, price change or policy means for ordinary users in South Africa.