Where Asia Closed Yesterday

Asia finished Wednesday split down the middle — Japan and the export-linked economies rallied while Greater China gave back ground.

The Nikkei 225 led the region with a 2.08% jump to 66,970, its strongest single-session gain in weeks. A weaker yen (USD/JPY holding near 159) continues to supercharge earnings expectations for Japanese exporters, and momentum from the US tech session carried through Tokyo’s afternoon trade. South Korea’s KOSPI added 0.73% to 6,345, with semiconductor names riding the same tailwind. Taiwan’s TAIEX gained 0.43% to 45,120, and Singapore’s Straits Times Index climbed 0.98% to 5,754 — the city-state’s best day in over a week.

China told the opposite story. The Hang Seng dropped 1.10% to 25,652, pressured by property-sector weakness and uncertainty around new economic policy direction — Beijing’s latest ambitions to position itself as a manufacturing hub for Muslim-majority nations added long-term optionality but didn’t move the needle for near-term sentiment. The Shanghai Composite fell 0.82% to 3,934 and the Shenzhen Component slipped 0.40% to 14,259. India’s Nifty 50 lost 0.46% to 24,471. New Zealand’s NZX 50 declined 0.62% to 13,775. Australia’s ASX 200 was the quiet one, edging up 0.19% to 9,250.

US Overnight Snapshot

Wall Street delivered a calm, green session. The S&P 500 rose 0.26% and the Nasdaq Composite gained 0.54%, led by technology stocks — XLK rallied 1.49% as optical-networking plays surged on Lumentum’s results and Nebius added fuel to the neocloud trade. The Russell 2000 climbed 0.57%, showing breadth beyond mega-cap tech.

The VIX dropped 4.78% to 14.6, firmly in complacency territory. That low-vol backdrop typically supports risk-taking in Asia’s morning session. Financials (XLF +0.21%) and energy (XLE +0.16%) added modest gains. The only red spot was materials (XLB -1.24%), which matters for ASX miners when Sydney opens.

The Nasdaq strength should give a lift to HKEX-listed tech and Taiwan’s semiconductor names at the open, partially offsetting yesterday’s China weakness. Cisco’s pullback despite record AI-driven results and the Bank of America cautionary note on Nvidia suggest the market is getting selective about AI winners — a theme that will filter through to Asian supply-chain names.

Commodity + FX Watch

Gold surged 1.73% to above $4,460, extending its run even as equities climbed — a sign that safe-haven demand and rate-cut expectations are both alive. That’s supportive for ASX gold miners like Newcrest and Evolution at the open.

WTI crude slipped 0.60% to $82.70, though the “Brent could hit $100 as Hormuz crisis flares” headline keeps geopolitical risk premium on the radar. Any escalation benefits ASX energy names and puts pressure on import-heavy economies like India and South Korea. Copper dipped 0.12% to $6.60 — marginal, but combined with the XLB sell-off, it’s a soft signal for base-metals miners.

AUD/USD ticked up 0.12% to 0.706, with December AUD futures hitting a six-week high — a tailwind for foreign investors holding ASX positions. USD/JPY at 159 keeps the yen weak, which is pure fuel for Nikkei exporters but compresses real returns for yen-based investors.

What to Watch Today

• HKEX tech rebound potential: Yesterday’s 1.10% Hang Seng drop came against a flat US session. With Nasdaq now up 0.73% overnight, Alibaba, Tencent, and Meituan ADR flows should provide a floor — watch whether Hong Kong can reclaim 25,800.
• Japan momentum continuation: The Nikkei’s 2% surge needs follow-through. With USD/JPY pinned near 159 and US tech strong, Toyota, Sony, and the semiconductor equipment cluster (Tokyo Electron, Advantest) are the names to watch for a third consecutive green session.
• ASX materials drag vs. gold bid: XLB’s 1.24% overnight drop and flat copper signal headwinds for BHP, Rio, and Fortescue — but gold’s surge could offset if Newcrest and Northern Star open strong. Net direction of the materials-vs-gold tug of war sets the ASX’s tone.
• Hormuz risk premium: The Brent $100 headline is noise until it isn’t. Any overnight escalation in Strait of Hormuz tensions would gap Asian energy stocks higher and hit Indian and Korean indices hard at the open.

Bottom Line

The overnight setup leans risk-on for Asia’s Thursday session. Low VIX, broad US gains, and strong tech leadership should support Japan, Korea, and Taiwan at the open. China remains the wildcard — yesterday’s weakness may find a floor if Hong Kong tech tracks the Nasdaq bid, but macro sentiment needs a fresh catalyst. Luna3 sees a session where the winners stay Japan and the export economies, with gold miners providing a secondary bid on the ASX.

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