Tech Turbulence: Asian Shares Waver Amid AI Breakthrough and Tariff Threats

Asian shares fluctuated influenced by South Korean stocks returning from the holiday. Despite pressure from new AI models and tariff threats, U.S. tech earnings bolstered sentiment. Central bank rate decisions and upcoming U.S. inflation data also impacted financial outlooks, as currency and commodity markets reacted to potential tariff escalations.

Asian shares wobbled on Friday, as the return of South Korean tech stocks post-holiday weighed on markets. Despite this, strong earnings reports from U.S. tech giants managed to sustain positive risk sentiment, although potential new tariff threats drove U.S. dollar and gold prices higher.

The market spotlight shifted to South Korea as the KOSPI index dropped 1% following a breakthrough in low-cost AI models from China's DeepSeek, causing a global market reaction. Notably, stocks like Samsung Electronics and SK Hynix experienced significant declines.

Meanwhile, technology stocks faced initial hurdles but have started to recover. Analysts remain optimistic about the medium to long-term outlook for AI investments, suggesting demand will absorb new technology advancements. Economic reports and central bank actions continue to shape market expectations for the coming months.

(With inputs from agencies.)