Asia Market Week in Review: Japan and Korea Surge on the AI Chip Boom, China Sits It Out

# Asia Market Week in Review: Japan and Korea Surge on the AI Chip Boom, China Sits It Out

Asia delivered the biggest moves of the week, and they were not in the market most people watch. While China stayed quiet, Japan and South Korea exploded higher on a wave of enthusiasm for artificial intelligence and the chips that power it.

Japan and Korea ride the chip trade

Japan's Nikkei 225 jumped about 4.5% on the week to around 66,400, deep in record territory, while South Korea's KOSPI ripped roughly 5.4% higher toward the 7,000 milestone. The driver was singular: semiconductors. Korea's memory-chip giants, Samsung Electronics and SK Hynix, led the charge as demand for the high-bandwidth memory that feeds AI data centers stayed red hot. That pulled Japan's chip-equipment and materials makers up alongside them.

Investors increasingly treat Seoul and Tokyo as two halves of a single AI hardware trade. When Korea's memory makers rally, Japan's suppliers of the machines and materials that build those chips tend to follow within hours. It is the same force lifting US names like Nvidia (NVDA) and AMD (AMD), just expressed through Asia's manufacturing backbone.

China sat the rally out

The contrast with China was stark. The Shanghai Composite edged up just 0.3%, the CSI 300 finished flat, and Hong Kong's Hang Seng actually fell about 1%. China's market marches to a different drum, shaped more by domestic property, consumer demand and policy than by the global AI frenzy. When the world's hottest trade is AI chips, mainland China largely watches from outside, a dynamic we explored in how China got pulled a different way.

What it means

The week was a reminder that the AI trade is now a global phenomenon with a physical supply chain running straight through Asia. Korea and Japan are no longer just followers of Wall Street; on chips, they increasingly set the tone. But it also underscores how narrow the rally is. This is a boom in one theme, semiconductors, and a market this concentrated can turn quickly if AI spending ever slows. For the two-sided debate, see our deep dive on whether Nvidia is overvalued.

The week ahead

The question for Asia is durability. As long as AI data-center spending holds, the memory and equipment names in Seoul and Tokyo have a powerful tailwind. Any wobble in that spending, or a broad risk-off move driven by rising US yields, would hit these high-beta chip names hardest. And keep watching China: a genuine turn in Beijing's stimulus could wake up the one major market that missed this run.