Emerging Markets: Emerging Asian stocks hold at 3-month low on AI fears; rupiah, Taiwan dollar slip

United Overseas Bank

29/07/2026 06:09

SK Hynix drops almost 16%, KOSPI triggers circuit breaker
Taiwan dollar weakest in more than a year
Singapore stocks notch all-time peak
Thai stock markets on holiday
By Sneha  Kumar and Nikita Maria Jino
July 29 (Reuters) - Tech-heavy South Korean and Taiwanese markets kept emerging Asian shares at a three-month low on Wednesday amid concerns about AI valuations, while the Indonesian rupiah and Taiwan dollar weakened against the greenback.
The MSCI EM Asia index .MIMS00000PUS fell more than 2% and the EM Asia IT index .MIMS0IT00PUS dropped nearly 5% to hover near April lows. 
South Korea's KOSPI .KS11 plunged over 12% to its lowest in almost four months, while Taiwan's benchmark index .TWII declined as much as 4.5% to slip to its weakest level since early May. Both markets comprise a major part of the two indexes. 
TSMC 2330.TW fell about 4% to its weakest level since mid-May. 
Investors have retreated from Asian chipmakers over the last few sessions on artificial intelligence worries, leaving the biggest winners of this year's tech boom struggling to hold on to their strong annual gains.
South Korean equities have shed more than 20% over the last two sessions, trimming their year-to-date jump to 25%, while Taipei shares have lost nearly 12% over the last four sessions. 
SK Hynix 000660.KS reported bumper quarterly results on Wednesday but fell short of lofty investor expectations, sending shares scuttling nearly 16% to a nearly three-month low. 
An 11% drop in Samsung Electronics 005930.KS also weighed on the Seoul benchmark. 
"Investors were looking for additional catalysts, particularly around long-term agreements and shareholder returns, to support a memory sector that has become the epicentre of the AI trade," said Gary Tan, portfolio manager at Allspring Global Investments.
"Without those signals, we expect volatility in AI-linked equities across Asia to persist as leveraged positions unwind and the market resets expectations." 
Elsewhere, stocks in Singapore .STI scored a record high of 5,648.75 points, carried by gains in major lenders DBS DBSM.SI, Oversea-Chinese Banking Corp OCBC.SI and United Overseas Bank UOBH.SI.    
The head of the city-state's central bank said on Tuesday that Singapore's economic growth should remain firm in the second half of this year, although a major uncertainty is the sustainability of the AI investment boom.  The FTSE Straits Times Index is among the top-performing markets in the emerging Asia region, surging around 21% so far in 2026.
Philippine shares .PSI rose as much as 2.1% to hit a one-week high, boosted by an over 1% gain in heavyweight International Container Terminal Services ICT.PS. 
Among regional currencies, the Taiwan dollar TWD=TP slipped 0.4% to its lowest since April last year, while the Indonesian rupiah IDR= briefly slipped below 18,100 to the dollar, having been hurt by the surprise resignation of the country's central bank governor earlier this week. 
On the other hand, the Korean won KRW= appreciated 0.6% to its strongest level since early May, likely finding support in the central bank's announcement that it would maintain a tightening policy stance to control core inflation.
Markets in Thailand were closed for a holiday.
     
HIGHLIGHTS:    
** Spread between Indonesia's 1-year ID1YT=RR and 10-year bond ID10YT=RR yields at 38.2 basis points
** China's tech-focused STAR 50 index .STAR50 dips more than 3%
** Bank Indonesia committed to furthering efforts to strengthen rupiah 
** South Korean government internally reviewing market stabilisation measures 
** 7.1-magnitude earthquake hits southern Japan, death toll at 13 
     
     
Asia stock indexes and currencies at 0429 GMT
COUNTRY
FX RIC
FX DAILY %
FX YTD %
INDEX
STOCKS DAILY %
STOCKS YTD %
Japan
JPY=
+0.19
-4.20
.N225
-2.80
20.42
China
CNY=CFXS
-0.01
+3.19
.SSEC
-0.53
-4.43
India
INR=IN
+0.10
-6.15
.NSEI
0.95
-7.33
Indonesia
IDR=
-0.19
-7.85
.JKSE
-0.85
-29.71
Malaysia
MYR=
+0.05
-0.76
.KLSE
0.04
1.97
Philippines
PHP=
+0.08
-4.22
.PSI
1.59
5.81
S.Korea
KRW=
+0.12
-0.88
.KS11
-12.03
25.74
Singapore
SGD=
+0.04
-0.49
.STI
0.57
21.56
Taiwan
TWD=TP
-0.31
-3.22
.TWII
-4.71
36.88
Thailand
THB=TH
+0.28
-6.01
.SETI
-
28.96
     

(Reporting by Sneha Kumar in Bengaluru; Editing by Lincoln Feast.)
((Sneha.kumar@thomsonreuters.com))