Stock markets in Japan and South Korea reached new heights on Monday, driven by excitement over developments in artificial intelligence and anticipation of a decision regarding the extension of the Iran war ceasefire. As negotiations continued between the U.S. and Iran, oil prices saw an increase of over 2%, partly due to discussions surrounding the reopening of the vital Strait of Hormuz for oil and natural gas transit.
While U.S. futures inched upwards, most Asian stocks advanced. Japan’s and South Korea’s benchmarks made significant gains, propelled by a surge in technology-related stocks. The Nikkei 225 in Tokyo rose by more than 1.3%, surpassing the 67,000 mark to hit 67,231.28. Shares of SoftBank Group, heavily invested in AI, increased by over 9% after setting records in the previous week. Likewise, South Korea’s Kospi index surged nearly 5%, reaching an all-time high of 8,874.16 with Samsung Electronics gaining over 9%. Official data indicated a 53% rise in South Korea’s exports in May, primarily due to heightened global demand for semiconductors.
The Nikkei 225 has climbed more than 12% over the last month, while the Kospi skyrocketed over 27% during the same period. Meanwhile, Hong Kong’s Hang Seng index saw a 0.9% increase, reaching 25,408.96. On the contrary, Shanghai Composite edged down 0.1% to 4,063.72 as China reported a slowdown in factory activity, indicating weaker demand for new exports. Australia’s S&P/ASX 200 slightly dropped by 0.1% to 8,720.30. Taiwan’s Taiex rose by 1.4%, and India’s Sensex increased by 0.6%.
Three months into the Iran war, market volatility remains due to unresolved uncertainties about a permanent ceasefire, with oil prices fluctuating. Despite these tensions, strong AI demand and positive corporate earnings have driven stock market rallies, including in the U.S. On Friday, President Trump met with advisers for high-level discussions but had not finalized a tentative plan to prolong the ceasefire by 60 days. Iran stated that a deal was not yet conclusive, and the status of the Strait of Hormuz reopening remains uncertain, as a U.S. sea blockade on Iranian ports is ongoing.
Early Monday, Brent crude oil, the global benchmark, rose by 2.4% to $93.33 per barrel, a significant increase from approximately $70 per barrel in late February before the war started. U.S. benchmark crude also increased by 2.8% to $89.76 per barrel.
Last Friday, Wall Street continued its upward trend with major technology stocks leading the way. The S&P 500 gained 0.2%, marking its seventh consecutive increase, reaching 7,580.06. The Dow Jones Industrial Average rose by 0.7% to 51,032.46, and the technology-focused Nasdaq composite edged up by 0.2% to 26,972.62.
Dell Technologies shares surged by 32.8% after reporting results that exceeded expectations and raising its outlook on robust AI-related demand. Meanwhile, Microsoft experienced a boost of more than 5.4%, and Broadcom increased by 4.7%.
In currency markets, the U.S. dollar strengthened against the Japanese yen, rising to 159.48 yen from 159.25 yen. The euro traded at $1.1645, down from $1.1667.
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