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Summary:

• Asian chip stocks rebounded: SK Hynix up about 5.5%, the KOSDAQ up about 4.6% (triggering a buy sidecar) and the KOSPI up about 1.9%
• The Nikkei rose about 1.2% for a third straight gain, helped by the strongest Reuters Tankan manufacturers’ reading in more than five years; SoftBank fell about 3%
• Brent rose about 1% to around $92.50 after strikes on Saudi Arabia’s East-West pipeline and a tanker attack near Hormuz
• Goldman now sees Fed hikes in December and March, with its first cut pushed to December 2027
• The Hang Seng fell about 0.9%, and Shanghai slipped 0.2%
• Australian investor home lending plunged 32.3% in Q3; gold rose about 0.5% to around $4,050

Asian technology stocks staged a broad rebound on Wednesday as fresh AI-related news restored some confidence after last week’s sell-off, while oil prices firmed on renewed attacks on Gulf energy supply routes. In the background, the US rate outlook turned more hawkish after Tuesday’s hot inflation data, with Goldman Sachs now forecasting Fed hikes in both December and March.

Oil

Brent crude rose about 1% and WTI gained close to 1%. Saudi Arabia’s Energy Ministry said on Monday that Aramco’s East-West pipeline had been targeted in the Medina region, with no announced impact on operations. Yemen’s Houthis claimed further strikes on several pumping stations on Tuesday, which Saudi authorities have not confirmed. The pipeline is Saudi Arabia’s main route for bypassing the effectively closed Strait of Hormuz. Separately, UKMTO said a tanker was struck by an unidentified projectile near Hormuz on Tuesday, with no injuries or environmental impact reported. Not everyone sees supply risk winning out: Morgan Stanley’s Michael Wilson told CNBC he expects oil to fall significantly into 2027 on demand destruction and new supply.

Fed and US rates

Goldman Sachs still expects a quarter-point Fed hike in December and has added another in March 2027, after a third straight month of hot inflation data, pushing its first rate cut back to December 2027. Fed speakers reinforced the hawkish tone. Philadelphia Fed President Anna Paulson said further gradual hikes seem appropriate, Chicago Fed President Austan Goolsbee called the CPI report borderline disturbing, and Vice Chair for Supervision Michelle Bowman said she is shifting her focus to inflation. A December hike is fully priced. US index futures firmed, with Nasdaq 100 futures up about 1.3% and S&P 500 futures up around 0.6%.

Japan

The Nikkei 225 rose about 1.2% to around 61,190, its third straight gain, and the Topix added close to 0.9%. Sentiment was supported by the Reuters Tankan, which showed manufacturers’ confidence at its highest in more than five years on booming chip demand. SoftBank Group fell about 3% after swinging to a quarterly net loss of about ¥1.1 trillion. USD/JPY was little changed near 158.80.

South Korea

Korean chip stocks led the region. SK Hynix jumped about 5.5% and Samsung Electronics gained around 3%, lifting the KOSPI about 1.9% to near 5,340. The tech-heavy KOSDAQ surged around 4.6% to near 700, triggering a buy-side sidecar that briefly suspended program buy orders.

China and Hong Kong

Greater China lagged. The Hang Seng fell about 0.9% to around 24,330, and the Shanghai Composite slipped about 0.2%.

Australia

Australian home lending fell 15.5% in the September quarter, almost double the expected decline, as investor lending plunged 32.3% following May’s curbs on negative gearing, tighter lending rules and five RBA rate hikes this year. The data adds to evidence that the RBA’s tightening is biting. AUD/USD edged up to around 0.6880.

Gold

Gold futures rose about 0.5% to around $4,050 an ounce, recovering part of Tuesday’s CPI-driven drop. Standard Chartered said gold continues to trade above the key $4,000 level, with oil, inflation risks and equities setting the tone ahead of the December Fed meeting.

Outlook

Attention now turns to Nvidia’s results next week, the key test of whether the rebound in AI stocks can hold, while oil remains the main swing factor for inflation and the Fed’s path.

This article was written by Eamonn Sheridan at investinglive.com.