Asian shares advanced on Thursday, led by chipmakers, after Nvidia’s forecast reinforced optimism over artificial intelligence demand and Samsung Electronics averted an immediate strike that had threatened to disrupt one of the world’s most important semiconductor supply chains.
The MSCI Asia ex-Japan index rose 2.6%, while South Korea’s KOSPI jumped more than 7%.
Taiwan gained 3.5%, Chinese blue chips added 1.1% and Japan’s Nikkei 225 climbed 3.6%, extending a broad risk-on move across the region.
The rally followed Nvidia’s stronger-than-expected first-quarter revenue and upbeat guidance for the current quarter, which helped ease concerns that the AI trade may be losing momentum.
Chief Executive Officer Jensen Huang maintained his optimistic view of demand, saying growth prospects remain strong as governments and companies continue to invest heavily in AI infrastructure.
“The chip landscape remains Nvidia’s world with everybody else paying rent, as more sovereigns and enterprises wait in line for Nvidia’s chips,” said Dan Ives at Wedbush Securities.
Still, Nvidia shares fell 1.3% in after-hours trading, while S&P 500 e-mini futures slipped 0.2%, suggesting investors remain sensitive to stretched valuations after a sharp run-up in AI-linked stocks.
Samsung strike threat eases
Samsung Electronics rose 6% after its union suspended planned industrial action following a tentative pay agreement.
The move eased concerns over a strike by nearly 48,000 workers that could have weighed on South Korea’s economy and global chip supply.
The relief may prove temporary. A shareholder group has said the proposed agreement could be illegal and warned it may seek an injunction if workers approve the deal in a vote.
That left investors balancing the immediate easing of labour tensions against the risk of further disruption at the company.
Samsung’s gains added to the broader semiconductor rally, with investors treating the suspension of strike plans as another supportive factor for regional technology stocks.
Oil and geopolitics remain in focus
Brent crude rose 0.6% to $105.68 as shipping flows through the Strait of Hormuz showed signs of easing after recent disruptions.
Images showing tankers carrying about 6 million barrels of oil passing through the waterway helped calm some concerns over supply risks.
Oil prices had slipped earlier in the week after US crude inventories fell for the week ended May 17.
Markets remain focused on tensions involving Iran and the Strait of Hormuz, a key route for global energy shipments.
Wall Street also offered support to Asian markets.
The S&P 500 rose 1.1% on Wednesday after three straight sessions of declines, while the Nasdaq Composite gained 1.5%.
Analysts at Westpac said investors took comfort from headlines suggesting the US was in the “final stages” of talks with Iran, helping oil prices ease and broader markets rally.
Japan and Australia diverge
Japan’s flash manufacturing PMI from S&P Global stood at 54.5 in May, down from 55.1 in April but still above the 50 mark that separates expansion from contraction.
Japanese exports rose 14.8% in April from a year earlier, marking an eighth consecutive month of growth.
“By and large, external demand has turned out exceptionally strong despite the US-Iran conflict. This should give the BOJ more confidence to hike in June, which should lift the yen if there are no fiscal mishaps,” DBS economists said.
The dollar was little changed at 158.84 yen in afternoon trading in Tokyo.
Australia’s ASX added 1.6%, lagging the wider region after mixed data.
The Australian dollar fell 0.7% to $0.7105 after employment unexpectedly declined in April and the jobless rate rose to its highest since late 2021.
Flash PMI data showed Australia’s services activity slowed to 47.7 in May from 50.7, while manufacturing held at 50.2.
Rates and the takeaway
The US 10-year Treasury yield rose 1 basis point to 4.578%, resuming its climb after a three-day pullback.
Minutes from the Federal Reserve’s April 28-29 meeting showed policymakers remained worried about inflation, with a growing number open to further rate increases.
For now, Asian markets are being supported by three forces: Nvidia’s confidence in AI demand, Samsung’s temporary labour reprieve and calmer signals from the Strait of Hormuz.
But higher US yields, unresolved geopolitical risks and mixed macroeconomic data in Japan and Australia suggest the rally may face further tests.
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