Asian Markets See Record Highs Amid AI Boom and Iran Negotiation Developments

Asian stock markets showed impressive gains on Monday, driven by the optimism surrounding the artificial intelligence sector and anticipation of developments in the Iran war ceasefire. Both Japan and South Korea’s stock markets reached new record highs. Investors are closely watching continued negotiations between the U.S. and Iran, especially regarding the reopening of the vital Strait of Hormuz.

Market Performance

Oil prices grew more than 2%, reflecting ongoing discussions between the U.S. and Iran about the crucial Strait of Hormuz. This key waterway is essential for global oil and natural gas transportation.

Asian shares broadly advanced, with Japan’s Nikkei 225 gaining over 1.3%, surpassing the 67,000-point threshold for the first time, peaking at 67,231.28. This was largely led by technology-related stocks, signaling continued strength in AI and advanced technologies.

South Korea’s Kospi index surged nearly 5%, achieving an all-time high of 8,874.16. Samsung Electronics, the country’s largest company, reported a rise of over 9%. Official South Korean data indicated that exports in May jumped 53% year-on-year, fueled by global semiconductor demand.

Taiwan’s Taiex rose by 1.4%, and India’s Sensex increased by 0.6%. Hong Kong’s Hang Seng index grew 0.9% to 25,408.96, whereas the Shanghai Composite index slightly declined by 0.1% to 4,063.72. China’s factory activity in May showed signs of deceleration due to weakening new export demand. Australia’s S&P/ASX 200 dipped slightly by 0.1%, marking at 8,720.30.

Impact of the Iran War

Despite three months passing since the Iran conflict began, uncertainties over a permanent ceasefire are affecting market behaviors and oil price fluctuations. Optimism surrounding robust AI demand and strong corporate earnings has instigated stock market rallies, including significant gains on Wall Street.

On Friday, U.S. President Donald Trump engaged in high-level discussions, yet there has been no decision on extending the ceasefire by 60 days. Iran has clarified that no agreement is finalized yet. The reopening of the Strait of Hormuz remains uncertain, exacerbated by the U.S. sea blockade on Iranian ports.

Brent crude oil rose by 2.4% early Monday, priced at $93.33 per barrel, contrasting the $70 per barrel before the war commenced. U.S. benchmark crude saw a 2.8% increase to $89.76 a barrel.

Wall Street and Currency Movements

Friday’s trading session saw Wall Street stock indices achieving new records, buoyed by major tech stocks. The S&P 500 rose 0.2%, marking a seventh straight advance, closing at 7,580.06. The Dow Jones Industrial Average increased by 0.7% to reach 51,032.46, while the Nasdaq composite ascended by 0.2% to 26,972.62.

Dell Technologies experienced a notable surge of 32.8%, exceeding expectations and revising its outlook due to strong AI-related demand. Microsoft gained over 5.4%, and Broadcom saw a rise of 4.7%.

In currency markets, the U.S. dollar strengthened to 159.48 Japanese yen from 159.25 yen, while the euro slightly declined to $1.1645 from $1.1667.