Asian stock markets started the new year on a strong note, with emerging market indices climbing and tech shares leading the charge.
Broad Market Move
The MSCI Emerging Markets index rose as much as 1.1% on Friday, reaching its highest level since late October. This continues a trend from last year when the index gained over 30% thanks to optimism around artificial intelligence.
Most regional currencies stayed within tight ranges, and the U.S. dollar slipped a bit.
AI Chip IPO Fuels Hong Kong Rally
In Hong Kong, shares of Shanghai Biren Technology Co., a company that makes AI chips, jumped 82% on the day of its public offering. The IPO raised about $717 million, highlighting China’s push to build a home‑grown chip industry.
Other tech giants such as Samsung Electronics and Taiwan Semiconductor Manufacturing also saw their stocks rise.
South Korean Won Under Pressure
South Korea’s central bank governor, Rhee Chang‑Yong, said the recent weakness of the won does not reflect the country’s real economic strength. He warned he would oppose any U.S. policy moves that could destabilise the currency market.
The won was about 0.2% weaker at 1,442 per dollar, making it one of the weaker Asian currencies that day, even as the Korean stock market hit a record high.
Rhee noted that the won’s rise into the upper 1,400s seems out of line with Korea’s economic fundamentals.
What This Means for Investors
- Tech exposure pays off: The AI chip IPO shows strong investor appetite for AI‑related stocks.
- Currency watch: The won’s dip signals potential volatility in emerging‑market currencies.
- Broader EM rally: A rising MSCI EM index suggests continued interest in emerging markets.
Bottom Line
Early 2024 is shaping up as a promising period for Asian emerging markets, especially in the tech sector. However, currency fluctuations, like the won’s recent slide, remind investors to stay vigilant.
Remember, this is perspective, not prediction. Do your own research and consider your risk tolerance before making any investment decisions.