Asian shares ended mostly higher on Thursday, with the MSCI Asia Pacific Index rising 0.6%, as regional trading volumes remained thin amid the Lunar New Year holidays in China, Hong Kong, and Taiwan. The rally was underpinned by easing concerns over the impact of artificial intelligence on the global economy, as well as a slew of upbeat earnings reports from major companies, including $TSM (Taiwan Semiconductor Manufacturing Company) and $SAP (SAP SE).
The Lunar New Year holidays, which began on January 22, have resulted in reduced trading volumes in the region, with many markets, including the Shanghai and Hong Kong exchanges, closed for the week. Despite the thin trading, investors remained focused on the ongoing earnings season, with $TSM reporting a 45% increase in quarterly profit, driven by strong demand for its semiconductor products. The company’s shares rose 2.5% on the news, outpacing the broader market.
In other news, $SAP, the German software giant, reported a 10% increase in quarterly revenue, driven by strong demand for its cloud-based products. The company’s shares rose 1.2% on the news, as investors welcomed the upbeat earnings report. The rally in Asian shares was also supported by a weaker US dollar, which fell 0.2% against a basket of major currencies, making exports from the region more competitive.
The easing of AI concerns was also a major factor in the rally, as investors began to realize that the impact of AI on the global economy may not be as severe as initially thought. According to a report by Goldman Sachs, the adoption of AI is likely to increase productivity and drive economic growth, rather than replace human workers. The report cited examples of companies, such as $GOOGL (Alphabet Inc.), which are using AI to improve efficiency and drive innovation.
| Index | Close | Change |
|---|---|---|
| MSCI Asia Pacific Index | 164.23 | 0.6% |
| Nikkei 225 | 27,441.85 | 0.3% |
| Hang Seng Index | 22,551.67 | 0.2% |
Looking ahead, investors will be closely watching the upcoming earnings reports from major companies, including $AAPL (Apple Inc.) and $MSFT (Microsoft Corporation), for clues on the health of the global economy. The impact of AI on the economy is also likely to remain a major theme, as investors seek to understand the implications of this emerging technology on the global economy.
⚡ Why it matters: The rally in Asian shares suggests that investors are becoming more optimistic about the global economy, despite ongoing concerns over the impact of AI. The easing of AI concerns and strong earnings reports from major companies are likely to support the market rally in the short term.
📊 By the numbers:
MSCI Asia Pacific Index rose 0.6% to 164.23
$TSM reported a 45% increase in quarterly profit
$SAP reported a 10% increase in quarterly revenue
US dollar fell 0.2% against a basket of major currencies
🔗 Source: Bloomberg
