Asian stocks today: Kospi, Nikkei rally up to 3% led by semiconductor stocks despite US-Iran war tensions

Asian stocks today: Asian markets rose for the first time in three sessions on Thursday, supported by a rally in semiconductor stocks.

South Korea’s Kospi rebounded sharply after slipping into bear market territory in the previous session. Kospi jumped 3% at the open, and the small-cap Kosdaq advanced 1.28%.

Japan’s Nikkei 225 gained more than 1.17%, while the broader Topix index edged up 0.20%. Meanwhile, Australia’s benchmark S&P/ASX 200 declined 0.83% in early trade.

What's driving Asian markets today?

The semiconductor sector remained in the spotlight after people familiar with the matter said the US listing of SK Hynix Inc. was oversubscribed by more than seven times. Separately, Bain Capital exited its investment in flash memory chipmaker Kioxia Holdings Corp. by selling its entire stake.

Brent crude advanced for a third straight session to trade near $78.80 a barrel as fresh strikes heightened concerns that the conflict could disrupt shipping through the Strait of Hormuz.

In the bond market, the two-year US Treasury yield, which is highly sensitive to expectations around Federal Reserve policy, climbed as much as five basis points during the US trading session to 4.23%, just one basis point below last month’s peak. The benchmark 10-year Treasury yield rose up to four basis points to 4.59%, its highest level since late May, while gold prices steadied following three consecutive days of losses.

Escalating geopolitical tensions and rising oil prices have revived inflation worries, leading money markets on Wednesday to shift expectations for the next Fed rate hike to October from December. The move has further weighed on investor sentiment at a time when markets are already contending with lofty equity valuations driven by the artificial intelligence rally.

According to a social media post by the US Central Command, the latest strikes were aimed at further weakening the ability to threaten freedom of navigation through the Strait of Hormuz.

Minutes from the Federal Reserve’s latest policy meeting showed that while a few officials saw a case for raising interest rates, they ultimately backed the decision to keep rates unchanged. The minutes also highlighted increasing concerns over inflation, even as fears about the labour market showed signs of easing.

US stock market today

Wall Street ended mixed on Wednesday, with the S&P 500 closing lower after US President Donald Trump said the interim agreement aimed at ending the Iran conflict was “over.” Meanwhile, chipmaker Broadcom led gains among semiconductor stocks that had recently come under pressure.

The S&P 500 fell 0.28% to close at 7,482.71, while the Nasdaq edged up 0.20% to finish at 25,870.65. The Dow Jones Industrial Average, however, dropped 1.09% to settle at 52,348.39.

The latest escalation in the conflict threatened to derail the equity market rally that has pushed the benchmark S&P 500 nearly 9% higher so far this year, even after experiencing steep losses in the wake of the Middle East war.

Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.