Asian stocks recovered on Friday after a heavy sell-off in the previous session, when investors dumped technology shares. Concerns about the debt carried by cloud company CoreWeave had raised questions about how the artificial intelligence boom is being financed.
The recovery was uneven across the region. Indonesia’s equity benchmark, however, slumped 11% after index provider MSCI said the country’s stock market no longer qualified as an “emerging market” and was preparing to remove it from a suite of products tracked by global investors.
Asian markets recover from tech-led selloff
Japan’s tech-heavy Nikkei rose 1.8%, recouping part of the almost 5% tumble it suffered on Thursday. South Korea’s KOSPI gained 2.8% after a near 8% plunge in the prior session. Other regional indexes also moved higher:
- Taiwan’s stock benchmark rose 0.7%.
- Hong Kong’s Hang Seng added 1.1%.
- Mainland Chinese blue chips edged up 0.3%.
The rebound followed a sharp fall for CoreWeave’s shares, which are backed by Nvidia. The stock had extended a 15.5% slump on Wednesday before partly recovering on Thursday. Reports that its bond yields had reached levels associated with distressed debt had triggered a broad, AI-focused equity selloff worldwide.
Analysts also pointed to pressure on memory chip makers this week. China’s ChangXin Memory Technologies, known as CXMT, reported progress on a next-generation DRAM design that could intensify competition with established manufacturers.
Indonesia faces setback after MSCI decision
The MSCI decision is likely to prompt investors to pull money out of Indonesia, a major setback for the market. The rupiah weakened about 0.8% to 95.0550 per dollar.
MSCI’s move means Indonesia will be cut from products that global investors use to track emerging markets. Market participants are expected to respond to that change in the coming sessions.
Dollar and gold ease as US yields fall
Bond markets steadied after yields dropped sharply on Thursday, when traders bought US Treasuries and other safe-haven government debt. Lower US yields this week reduced demand for the dollar, which was on track for its first weekly loss in five weeks.
The dollar index hovered near 102 after a sharp pullback from Wednesday’s 1-1/2-year high near 103. The euro recovered from as low as $1.1113 on Wednesday to trade at $1.1217 on Friday. Sterling was steady at $1.3278 after a 0.6% gain on Thursday, and the dollar was little changed at around 158 yen.
Gold slipped 0.4% to $4,154.51, having climbed 1.6% on Thursday on safe-haven demand.
Oil eases as Middle East risks and tanker sanctions weigh
Crude oil edged lower as investors weighed Middle East risks against possible US steps to ease restrictions on the so-called shadow fleet of tankers. A US official said on Wednesday that the Trump administration was considering lifting sanctions on some shadow fleet vessels that have carried oil and petroleum products from countries including Russia, Iran and Venezuela. The aim, the official said, would be to reduce record-high global freight rates.
Still, the escalating conflict between Saudi Arabia and Yemen’s Houthis, along with renewed attacks on ships in the region, has supported prices. Brent crude futures eased 0.4% to $105.51 a barrel, while US West Texas Intermediate futures fell 0.6% to $97.43.
Markets are also looking ahead to central bank comments at the IMF-World Bank Annual Meetings in Bangkok, including from Federal Reserve Chair Kevin Warsh. Kyle Rodda, a markets analyst at Capital.com, said in a client note that “global markets are getting very noisy once again” after a period of low volatility.
