Hong Kong (AFP) – Asian stocks fell on Wednesday as markets digested the lack of progress towards Middle East peace and setbacks that rattled the boom in AI technology. Iran’s chief negotiator said on Tuesday that Washington must accept Tehran’s latest peace plan or face failure, after US President Donald Trump warned the truce in the Middle East war was on the brink of collapse. Both sides have refused to make concessions and repeatedly threatened to resume fighting, but neither appears willing to return to all-out war.
Traders are now looking to China, where Trump is due to land on Wednesday, the first visit by a US president in nearly a decade, saying he expected a “long talk” with counterpart Xi Jinping about Iran. Hong Kong, Shanghai, Taipei, Sydney, Bangkok, Manila, and Kuala Lumpur were all down on Wednesday. Jakarta fell nearly two percent as the rupiah plunged to a record low. The conflict in the Middle East has sent energy costs spiraling. Traffic through the Strait of Hormuz — through which one fifth of the world’s oil supplies usually pass — has virtually ground to a halt. But oil prices cooled during early Asia trade, with the international benchmark Brent crude down 0.6 percent to $107 a barrel, while US benchmark West Texas Intermediate fell 0.5 percent to $101 a barrel.
Seoul showed signs of recovery after the presidential Blue House distanced itself from calls for a social tax on artificial intelligence profits. The tech-rich Kospi had plunged five percent on Tuesday after a top official proposed a “national dividend” to redistribute excess corporate profits from artificial intelligence. South Korea has said it will triple spending on AI this year, aiming to join the United States and China as one of the world’s top three AI powers. The collapse of Samsung Electronics’ talks with its largest labor union dished another blow to Seoul’s AI drive, with company shares falling as much as 6.1 percent, Bloomberg reported. Samsung is a major producer of chips used in everything from artificial intelligence to consumer electronics, raising the prospect that a planned walkout could cause severe disruption and losses.
The latest consumer price index data in the United States released on Tuesday confirmed that high energy prices are stoking inflation, with the index hitting a three-year high in April. Traders will also keep an eye on Chinese internet giants Alibaba and Tencent, which are set to report results. The two firms are racing to invest in AI but have suffered weak share performance as they struggle to keep up with US competitors. Alibaba, the e-commerce behemoth behind shopping platforms like Taobao, is known for its open-source “Qwen” AI models — popular with programmers — while gaming and social media firm Tencent launched an AI model in 2023 and a chatbot the following year.
Key figures at around 0215 GMT: Brent North Sea Crude: DOWN 0.6 percent at $107.13 a barrel; West Texas Intermediate: DOWN 0.5 percent at $101.63 a barrel. New York – DOW: UP 0.1 percent at 49,760.56 points (close); New York – S&P 500: DOWN 0.2 percent at 7,400.96 (close); New York – Nasdaq Composite: DOWN 0.7 percent at 26,088.2 (close); London – FTSE 100: FLAT at 10,265.32 (close); Paris – CAC 40: DOWN 1 percent at 7,979.92 (close); Frankfurt – DAX 30: DOWN 1.6 percent at 23,954.93 (close); Tokyo – Nikkei 225: UP 0.3 percent at 62,911.46 (close); Hong Kong – Hang Seng Index: DOWN 0.2 percent at 26,289.32; Shanghai – Composite: DOWN 0.3 percent at 4,203.66.
Euro/dollar: DOWN at $1.1738 from $1.1745 on Tuesday; Pound/dollar: UP at $1.3538 from $1.3542; Dollar/yen: UP at 157.71 from 157.57 yen; Euro/pound: FLAT at 86.70 pence.
© 2024 AFP
