Asian stock markets were buoyant on Friday! Investors were seen piling back into semiconductor and chip counters as confidence in demand for Artificial Intelligence (AI) technology remained solid.
The MSCI Asia Pacific Index rose 0.5%, led by South Korea's Kospi index which jumped 2.6%. However, the US Nasdaq 100 futures market fell slightly by 0.4%, signaling that investors in the West are still taking a cautious approach.
Oil Prices Cool Down, Markets See US-Iran War Under Control
On the commodities stage, fears of an energy crisis appear to be easing:
Brent Crude Oil: Down 0.3% to around $76 a barrel, extending losses from Thursday. Traders say the latest conflict between the US and Iran is unlikely to escalate into a major energy disruption.
Bond Market: Falling oil prices helped US Treasuries maintain their gains, with the 10-year yield at 4.55%. The same situation also supported Japanese and Australian government bonds.
Market analysts described the current retaliatory airstrikes between the US and Iran as a "managed escalation" scenario, where the global market is still able to absorb the shock without triggering extreme panic.
RM1 Trillion More! Chip Companies Investing in AI
Optimism towards technology stocks is back on track after investors realized that the panic selling phase earlier this week was just a temporary disruption. Two global chip giants prove their AI budgets are not empty:
Micron Technology: Announces mega plan to increase capital expenditure on new US factories by up to $250 billion!
SK Hynix: Successfully raised a giant fund of $26.5 billion through an American depositary receipt (ADR) offering on the US Nasdaq market (traded under the symbol SKHY starting this Monday). The money will be used to finance AI computer component projects.
More interestingly, SK Hynix and Samsung Electronics are preparing to increase investment in South Korea under a government initiative plan worth $880 billion (around RM3.9 Trillion!).
Second Half 2026 Strategy: Not Who Spends a Lot, But Who Gets a Profit!
Although AI is predicted to remain the 'main driver' of the stock market for the second half of 2026, the investment narrative has now begun to change (evolving). The market after this will become more selective (selective).
Giant companies now not only need to record profits that beat estimates, but they must prove that their profit margins remain high, provide solid future projections (guidance), and be supported by a decline in inflation rates.
The rally in technology stocks this Friday is good news for growth stock portfolio holders. The drop in oil prices to $76 per barrel has also provided temporary relief to global inflation concerns.
We expect the market focus next week to shift entirely to earnings season, starting with the US banking and financial sectors. These reports will be crucial to confirm whether the current stock market rally is truly healthy or simply driven by AI hype.
