Asia-Pacific tech stocks surge 4% as KOSPI triggers trading halt

Asia-Pacific tech stocks rebounded Tuesday, with South Korea's KOSPI surging 4.7% to 6,821.41 after a four-day selloff triggered a program-trading halt known as the Sidecar mechanism.

"The market has undergone a considerable correction, while corporate earnings have remained relatively resilient," Ikuo Mitsui, a fund manager at Aizawa Securities in Tokyo, said.

Samsung Electronics jumped 7.4% and SK Hynix gained 6.4%, leading the KOSPI's recovery from a 4.5% drop Monday. Japan's Nikkei 225 added 2.8% to 65,926.41 after a holiday, with Kioxia Holdings surging 15.9% and Advantest climbing 6.9%. Taiwan's Taiex rose 3.6% as TSMC advanced 2.8%. The MSCI Asia Pacific index gained 2% to 265.96, snapping four straight days of declines. India's Sensex was the outlier, edging 0.1% lower.

The rebound sets the stage for an important week as Tesla and Alphabet report earnings Wednesday, the first of six Big Tech results that will test whether massive AI investments are translating into revenue growth. Microsoft, Meta, Apple and Amazon are scheduled to report next week.

Oil Retreats as Diplomatic Efforts Advance

Oil prices retreated as diplomatic efforts in the Middle East gathered pace, with Brent crude falling 0.7% to $88.63 a barrel. Iran said mediators had presented proposals for a 10-day ceasefire, easing supply concerns that had pushed crude higher in recent sessions. WTI crude slipped 0.3% to $82.24.

Gold rose nearly 1% to about $4,044 an ounce, as investors sought safe-haven assets despite the equity rebound. The US 10-year Treasury yield held at 4.59%, while the dollar was little changed against major peers, with the euro at $1.1414 and the yen at 162.48 per dollar.

Trump Escalates Trade War With Canada

The White House announced a 50% additional tariff on about $20 billion of Canadian imports, including hockey sticks, wine and cement, effective Aug. 19. The move escalates a long-running trade dispute between the two neighbors, with Canada saying the tariffs violate their free trade agreement. Canadian Prime Minister Mark Carney said the country "stands ready to engage intensively" to resolve outstanding issues.

Earnings Season to Test AI Narrative

BlackRock Investment Institute strategists led by Jean Boivin said in a note that "the AI investment boom — as a key driver of growth — and our preference for AI infrastructure remain intact" despite recent volatility. They added that the global economy is "far less dependent on oil than in past energy shocks," making it more resilient to price increases.

The coming earnings reports will provide the clearest signal yet on whether the AI spending cycle is delivering returns. Nvidia rose 0.2% Monday, while Micron Technology gained 1.9% and Broadcom added 2%.

This article is for informational purposes only and does not constitute investment advice.