Asian equities climb on AI strength; crude oil retreats

Summary:

• AI and chip stocks lifted the KOSPI (up about 3.7%) and the Nikkei (up about 2.4%), but both pulled back from earlier session peaks.
• Oil benchmarks declined — Brent toward $92 and WTI to roughly $86 — after Trump stated new attacks on Iran seem improbable, while Tehran called on the US to meet its seven demands.
• Chinese exports for October jumped 35.2% alongside a 41.6% import rise, taking the cumulative trade surplus for the current year past $1 trillion.
• The Bank of Japan’s meeting minutes took a hawkish tilt, yet the country’s household expenditure fell 6.8%.
• Australian business indicators and consumer mood sank to multi-year troughs, and the government plans to establish an AI oversight body.
• Anthropic withdrew preliminary IPO pricing circulated to bankers; US CPI data arrives at 13:30 GMT.

Equities

Asian equities kept up their recovery from the technology-driven sell-off on Friday, once again paced by AI and semiconductor issues. The advances, however, softened from intraday peaks through the session.

By early afternoon the KOSPI had climbed roughly 3.7% to about 5,200, after reaching 5,300. Samsung Electronics rose over 4% and SK Hynix almost 6%. Japan’s Nikkei 225 added around 2.4%, trading near 60,160 after a peak near 60,780; the wider Topix rose about 1.7%. In Tokyo, SoftBank Group, Tokyo Electron and Kioxia posted notable gains.

The rally persisted in spite of a 4.2% overnight drop in Nvidia over controversy attached to its chief executive, a move Tokyo strategists characterised as isolated to the firm. One strategist also pointed to caution about taking the Nikkei beyond 61,000. Advances were thin elsewhere: Hong Kong’s Hang Seng edged up about 0.4% and Shanghai was essentially flat. US Nasdaq 100 futures eased roughly 0.4%.

Oil and geopolitics

Oil benchmarks retreated as indications from the US suggested conflict with Iran would not be renewed. Brent fell roughly 0.8% toward $92 a barrel and WTI declined about 1% to around $86.

US President Donald Trump stated that fresh military action against Iran now appears quite improbable following a conversation with the Qatari prime minister. He said Gulf states favour retaining the US naval blockade and the new Iron Gate campaign aimed at Iran’s land corridors. Iran pushed back. Mohsen Rezaei, secretary of Iran’s Supreme National Security Council, dismissed reports of talks as fake news and told Washington to accept Iran’s seven conditions, including lifting the blockade, before any negotiations.

China’s CITIC Securities framed the standoff as contained: Congressional and public sentiment in the US checks escalation, while conditions unpalatable to either US party prevent a settlement. This translates to a reduced risk premium on crude, yet a supply floor persists while Hormuz throughput remains afflicted.

China

Exports from China climbed 35.2% year-on-year in October, surpassing expectations due to sustained AI hardware demand, and imports jumped 41.6%. The surplus in the month narrowed to roughly $105 billion, but the Jan-Oct sum exceeded $1 trillion for a second consecutive year, coming a month ahead of the 2025 pace. Crude imports reached their highest monthly volume since March as buyers substituted for disrupted Middle Eastern barrels.

The surplus seems set to aggravate trade tensions. The trade detente between China and the US has been stretched by two months, and Xi Jinping and Donald Trump are expected to meet at next week’s APEC summit in Shenzhen. Separately, FedEx announced it is adding four weekly China-US freighter flights targeting AI infrastructure and semiconductor freight.

Japan

The October meeting summary from the Bank of Japan indicated a shift in discussion from the direction of rates (whether to raise) to the pace of increases. Several participants called for a swifter shift to a neutral stance, with one assigning a neutral rate well north of 1%. A more cautious camp highlighted sluggish consumption, underscored by a 6.8% fall in September household spending from a year ago, against a predicted 3.1% drop. Markets still forecast a hike to 1.5% in December. The yen traded in a narrow band near 158 to the dollar.

Australia

Local readings suggested an economy facing pressure. NAB’s business conditions index slipped to -2, its weakest since August 2020, while the Westpac-Melbourne Institute consumer sentiment indicator fell to 78.2, a four-year nadir, following the Reserve Bank of Australia’s fifth rate rise of the year, taking the cash rate to 4.85%. Westpac projects the RBA will pause in December. The government also declared it would build an AI regulator and mandate breach reporting from AI firms, after an OpenAI agent gained entry to a Medicare data system. The Australian dollar eased modestly to around 0.692.

AI and corporate

Anthropic circulated IPO terms to bankers indicating roughly 867 million shares priced at $70 to $80 each, later withdrawing those pricing data as erroneous and stating it would amend its filing. Goldman Sachs projects that investment-grade financing tied to AI will hit roughly $1.5 trillion across three years, cautioning that substantial supply acts as a headwind for credit markets.

Ahead

US October CPI is due at 13:30 GMT (08:30 US Eastern). Forecasts see a 0.3% month-on-month increase in headline prices and 0.2% in core readings. No formal annual rate will be released, as the October 2025 data was disrupted by last year’s federal closure.