Technology shares across Asia advanced on Thursday, supported by strong earnings in the artificial intelligence sector, while a sharp rise in oil prices and increasingly hawkish signals from central banks put pressure on global bond markets.
Investor sentiment was influenced by expectations that both the European Central Bank and the Bank of England could signal higher interest rates, following a divided decision by the Federal Reserve in which three members opposed maintaining an easing bias.
Outgoing Fed Chair Jerome Powell indicated he would remain as a governor for the time being to safeguard institutional independence, as Kevin Warsh — selected by Donald Trump — moves closer to confirmation as his successor.
Markets have quickly adjusted, ruling out rate cuts this year and assigning roughly even odds of a rate hike by next spring. Rising US Treasury yields and a stronger dollar reflected this shift, with the greenback climbing past 160 yen.
Oil prices also added to market concerns, with Brent crude surging 6% overnight to a four-year high of $122.53 per barrel amid fears that the Strait of Hormuz may remain closed for an extended period.
Despite broader macroeconomic risks, optimism around artificial intelligence continued to support equities. Strong earnings from Alphabet Inc. lifted its shares by 7% in extended trading, boosting Nasdaq futures by around 1%.
Other major tech firms, including Amazon and Microsoft, also reported solid results, raising expectations for Apple ahead of its earnings release.
However, Meta Platforms disappointed investors after increasing its annual capital expenditure outlook to invest heavily in AI infrastructure, sending its shares down 7%.
MSCI’s broadest index of Asia-Pacific shares outside Japan was largely unchanged on Thursday, though it remained on track for a strong monthly gain of around 16%. Japan’s Nikkei index slipped 1% on the day but posted a similar gain for April.
In South Korea, the KOSPI reached a new all-time high, supported by Samsung Electronics, which reported an eightfold jump in operating profit driven by strong AI demand, before some profit-taking emerged.
Chinese blue-chip stocks edged up 0.2%, while Hong Kong’s Hang Seng index dipped 0.3%.
Meanwhile, global bond markets came under pressure. Benchmark US Treasury yields climbed to around 4.42%, the highest since late March, while Japan’s 10-year government bond yield rose to levels not seen since 1997. Australia’s 10-year yields also surged.
The US dollar strengthened alongside higher yields, hovering near a two-week high and trading around 160 yen — a level that has previously triggered intervention concerns.
The Japanese currency has fallen more than 2% since the onset of the conflict on February 28, with investors building their largest short positions in nearly two years, reflecting doubts that policy tightening or intervention will provide meaningful support in the near term.
