Asian Stocks Rise as BOJ Hikes Rates and AI Semiconductor Rally Returns

Bank of Japan Raises Rates to 1.25%

The Bank of Japan voted 7-2 to raise its benchmark interest rate by 25 basis points to 1.25%, with two policy members dissenting against the move, according to official statements reviewed by Investing.com. BOJ Governor Kazuo Ueda scheduled an afternoon press conference to address the decision. Several financial analysts characterized the outcome as relatively dovish, noting that the dissenting votes helped soften market expectations regarding aggressive future monetary tightening.

Wall Street Momentum and Bond Yield Relief

Japan’s financial moves followed a strong session on Wall Street. Overnight trading saw the Nasdaq jump 1.7%, while broader indices also posted gains. In response to dropping energy costs, bond markets stabilized; the US 10-year Treasury yield dropped 9 basis points to 4.93% after hitting 5.02% earlier in the week, according to market tracking cited by Investing.com. Benchmark yields in Australia, Japan, and [region] similarly drifted higher as regional trading commenced.

Semiconductor Rally Follows AI Stock Volatility

Technology and semiconductor shares mounted a sharp recovery following a volatile week driven by artificial intelligence sector jitters. Major AI executives previously called for safety guardrails and moderated development speeds, which triggered widespread selling across tech supply chains. However, as demand for AI infrastructure proved resilient, investors returned to the sector. South Korea’s Kospi index gained 1.70% to close at 65,228 following its earlier weekly dip, while Japanese semiconductor-linked equities saw notable upward momentum.

Oil Prices Slip on Diplomatic Progress

Crude oil prices fell 1.2% to $103.56 per barrel, marking a third session of declines as traders tracked diplomatic efforts surrounding Middle East tensions, according to Investing.com. Saudi Arabia worked to restore capacity along its East-West pipeline following a recent drone attack, while diplomatic channels engaged regional actors to help stabilize maritime traffic around the Bab el-Mandeb Strait.

Chinese Equities and Regional Market Performance

Chinese mainland markets participated in the broader relief rally, with the Shanghai Composite rising 1.1% to 4,511.20, though it retained a weekly loss of roughly 0.6%, according to Investing.com data. Hong Kong’s Hang Seng index added 0.7%, led by gains among domestic technology firms such as MiniMax and Z.AI. Across other regional exchanges, Australian and New Zealand indices remained largely flat, while Indian and Thai markets posted modest gains ahead of the weekend.