Asian stocks decline as West Asia risks, AI rally doubts persist

KOSPI enters a technical 'bear market' after 20% drop from peak


Asian equities opened in a muted session on Tuesday August 4 as investors balanced a rebound on Wall Street against persistent unease over West Asia and questions about how much further the AI-driven rally could extend.

Contracts in Hong Kong and Australia stayed largely flat, tracking a mixed regional mood. The Nikkei 225 slipped 0.8% and the Topix eased 0.5%, the Kospi was down 1.9% while the Hang Seng climbed 0.48%.

US futures held steady after both the S&P 500 and the Nasdaq 100 rallied more than 1% overnight on the back of a technology-led surge, with Palantir Technologies jumping in after-hours trade once it lifted its full-year revenue and income guidance.

Investors weighed the overnight relief against a fresh round of corporate earnings due this week, watching for proof that heavy AI-related spending was feeding through into stronger growth and profits.

Bloomberg citing analysts noted that of the 307 S&P 500 firms that had reported so far this season through Friday, 86% topped earnings estimate while 68% beat sales forecasts and 15% fell short.

Crude oil steadied after tumbling roughly 5% on Monday, when US President Donald Trump warned that ongoing talks represented Iran’s final opportunity before he called off a planned strike.

Brent crude held above $84 a barrel while West Texas Intermediate slipped 0.4% to $80.01. Traders remained cautious given Tehran had not yet indicated it would restore unrestricted passage through the Strait of Hormuz, a route that carried roughly a fifth of global oil supply before the conflict began.

The Japanese yen slipped 0.1% to trade around 157.40 per dollar, steadying after a sharp early rally on Monday had sparked speculation that Japanese authorities intervened again to support the currency, following last week’s coordinated action with Washington.

The offshore yuan was little changed at 6.7573 per dollar. Treasury yields fell after a volatile week, offering some additional support to risk sentiment heading into Tuesday’s session.

Also Read: Nifty Outlook for August 4: New closing mechanism takes index past recent swing highs but can that sustain?



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