Asian stock markets experienced a significant surge on Wednesday, mirroring the record gains seen on Wall Street the previous day. Investor confidence in AI technology and anticipated interest rate cuts in the United States has reached a high point. The US Federal Reserve is expected to announce a quarter-percentage-point cut to lending rates on Wednesday, which has contributed to the extended bull run.
The growing optimism about a potential deal to avoid a damaging trade war between the world’s top two economies has also boosted the markets. US President Donald Trump is set to meet his Chinese counterpart, Xi Jinping, in South Korea, and has hinted at confidence in reaching an agreement. This development has added to the already positive atmosphere on Wall Street, where artificial intelligence giant Nvidia saw a five-percent leap on Tuesday.
Analysts note that there is little concern about holding tech risk into the upcoming Fed meeting, which is expected to be a lower-impact event on markets. Chris Weston of Pepperstone stated that “it’s the tech show, and this is where capital remains firmly centered.” Japan’s benchmark index jumped by over two percent on Wednesday morning, while Seoul surged more than one percent, both reaching record highs. Shares in Taipei and Shanghai tracked moderate gains, while Sydney’s main index was down and Hong Kong was closed for a public holiday.
The record streaks have picked up pace ahead of expected earnings reports by major US tech giants, including Microsoft and Meta. This year’s AI boom has coincided with a global tariff onslaught unleashed by the US president, with policies hitting China particularly hard. Trump expects “a lot of problems are going to be solved” during his first in-person discussion with Xi since returning to the White House this year.
The meeting between the two leaders is scheduled to take place on Thursday on the sidelines of the APEC summit in Gyeongju. As the global economy waits with bated breath for the outcome of this meeting, the trajectory of the trade war and its impact on the tech industry will be closely watched. The current market trends and expected developments will be crucial in determining the future of the global economy.
Key figures at around 0230 GMT include the Tokyo Nikkei 225, which is up 2.0 percent at 51,234.49, and the Shanghai Composite, which is up 0.1 percent at 3,992.49. The West Texas Intermediate is flat at $60.15 per barrel, while the Brent North Sea Crude is up 0.1 percent at $64.43 per barrel. The euro/dollar is down at $1.1643, and the pound/dollar is down at $1.3261. The dollar/yen is up at 152.11 yen, and the euro/pound is flat at 87.80 pence. The New York Dow is up 0.3 percent at 47,706.37, and the London FTSE 100 is up 0.4 percent at 9,696.74.