Asian stocks concluded the trading session with a mixed performance amid light trading volumes on Monday. Japanese markets were closed in observance of Marine Day, following a notable decline of 6.4 percent in the Nikkei index last week, driven by a sell-off in the technology sector. Another spike in crude oil prices and inflation concerns weighed on regional sentiment, despite the rise in Chinese and Hong Kong markets following the release of a new artificial intelligence model by China’s Moonshot AI. Gold remained relatively stable above $4,000 an ounce during Asian trading hours, as the dollar softened and risk currencies experienced a rebound, notwithstanding concerns regarding potential Federal Reserve rate hikes. Brent crude futures surged toward $90 a barrel, extending last week’s rally as the United States conducted strikes against Iran for the ninth consecutive day, while Iran retaliated against U.S. assets throughout the Middle East, thereby posing threats to shipping in the Strait of Hormuz.
China’s Shanghai Composite index increased by 0.85 percent to 3,796.28 after reports indicated that a state-backed “national team” of funds purchased approximately $9 billion in stocks to bolster the market following a significant sell-off on Friday. Hong Kong’s Hang Seng index experienced a notable increase of 2.36 percent, reaching 25,143.05, driven primarily by the performance of technology stocks such as Alibaba and Baidu. Seoul stocks experienced a significant decline as investors persisted in divesting shares associated with artificial intelligence. The Kospi index declined by 4.46 percent, settling at 6,516.27, as apprehensions regarding China’s progress in artificial intelligence took center stage. Tech heavyweights Samsung Electronics and SK Hynix experienced declines exceeding 4 percent, while LS Electric recorded a loss of 5.6 percent and Hyosung Heavy Industries saw a significant drop of 9 percent. Australian markets surrendered early gains to conclude slightly lower, as technology stocks declined, counterbalancing advancements in the energy sector due to concerns over supply in the Strait of Hormuz.
Across the Tasman, New Zealand’s benchmark S&P/NZX-50 index concluded slightly elevated at 13,696.03 in anticipation of the forthcoming Q2 inflation data scheduled for release on Tuesday. U.S. stocks concluded the trading session on Friday with a decline, influenced by Netflix’s underwhelming third-quarter guidance. Concurrently, oil prices surged over 4 percent, reaching their highest levels in more than a month, driven by rising concerns regarding the intensifying conflict in the Middle East. Chinese startup Moonshot AI has introduced what it asserts is the largest open AI model globally, Kimi K3. This development has sparked apprehensions that the current surge in AI investments, which has been a significant factor in this year’s market rally, may be jeopardised.
In economic news, a measure of U.S. consumer sentiment increased to a five-month high in July, while single-family housing starts and building permits experienced a decline. Additionally, industrial output saw a modest rise of 0.1 percent month-on-month in June, falling slightly short of expectations. The tech-heavy Nasdaq Composite experienced a decline of 1.4 percent, while the S&P 500 saw a decrease of 1 percent, and the Dow fell by 0.8 percent.