Asian stocks moved higher on Wednesday, supported by a rebound in technology shares, particularly in Japan. However, lingering concerns about the long-term impact of artificial intelligence on the tech sector continued to weigh on sentiment.
Several major regional markets, including China, South Korea, Hong Kong and Singapore, remained closed for the Lunar New Year holiday. As a result, overall trading volumes across Asia were relatively subdued.
Markets in the region also drew modest support from Wall Street, where U.S. equities edged higher overnight amid a mixed recovery in technology stocks. S&P 500 futures were largely flat late in the session, as investors shifted focus to key upcoming U.S. economic releases.
Attention is centered on the minutes from the Federal Reserve January meeting, due later in the day, as well as Friday’s personal consumption expenditures (PCE) price index data — the Fed’s preferred inflation gauge. These reports are expected to provide further clarity on the U.S. interest rate outlook.
Japan stocks rebound on tech gains
Japan’s Nikkei 225 climbed 1.1%, while the broader TOPIX index gained 1.4%, both recovering from sharp losses earlier in the week. Technology stocks were among the strongest performers, bouncing back after several weeks of heavy declines.
Broader Japanese equities also benefited from bargain buying following two consecutive sessions of steep losses, which were triggered by weak fourth-quarter GDP data released earlier this week.
January trade figures provided additional support. Data showed Japan’s exports surged more than expected, although imports unexpectedly declined. Despite the strong export performance, the country still recorded a trade deficit for the month.
Australia extends gains; India remains cautious
Australia’s ASX 200 rose 0.4%, building on gains from the previous session. CSL Ltd helped lift the index after rising 0.6% on news of a licensing agreement with Eli Lilly and Company.
Meanwhile, BHP Group Ltd slipped 1.6% from record highs despite reporting strong first-half earnings. Santos Ltd declined 1.7% after posting a 25% drop in annual profit, and Suncorp Group Ltd also fell following weaker earnings results.
Australian wage price index data showed income growth broadly met expectations in the December quarter, suggesting resilience in the economy. However, the figures also reinforced concerns about persistent inflation pressures.
In India, the Nifty 50 traded little changed in morning deals. Local software stocks continued to struggle after sharp losses in recent weeks.
Major Indian IT firms, including Infosys Ltd, Wipro Ltd, and HCL Infosystems Ltd, have fallen significantly amid concerns that advancements in AI-driven software and agents could erode their market share.
Global technology and software stocks have also faced pressure following the launch of new AI tools by Anthropic, fueling debate over the sector’s future competitive landscape.
