Stocks rebound after tech sell-off and Indonesia shares sink on market downgrade warning

HONG KONG (AP) — Asian shares mostly advanced on Friday, a day after a tech sell-off dragged stocks lower, while Indonesia’s stock market plunged following a downgrade warning.

Index provider MSCI warned it would downgrade Indonesia from its “emerging market” status, triggering growing concerns of a capital flight.

U.S. futures edged higher after Federal Reserve chair Kevin Warsh said the artificial intelligence shock could bring huge benefits to the global and U.S. economies.

South Korea’s benchmark Kospi index jumped 3.6%, after tumbling 7.6% the day before on a sell-off of shares related to artificial intelligence. Samsung Electronics was up 4.2%, while memory chipmaker SK Hynix added 3.5%.

Japan’s Nikkei 225 rose 1.9% to 65,658.59, after falling 4.9% a day earlier. OpenAI investor SoftBank Group climbed 1.7%. Chip equipment maker Tokyo Electron was 2.8% higher and memory chipmaker Kioxia Holdings advanced 3.2%.

The Asian technology stocks traded higher after losses in AI shares moderated in the U.S.

Warsh said Friday at the IMF and World Bank gathering in ⁠Bangkok that AI could bring about positive impacts to global economies.

“I’d say, the advent of this new technology is probably the most consequential change to the U.S. and the global economy in my lifetime,” Warsh said. “There really is, I think, a huge benefit to the global economy, the U.S. economy, over the horizon.”

Taiwan’s Taiex, which also benefited from the AI frenzy, was up 0.6%. But shares of TSMC, or Taiwan Semiconductor Manufacturing Co., were 0.4% lower even as it posted record quarterly profits on Thursday and said AI demand remained very strong.

In Indonesia, the Jakarta Composite index fell more than 10%, the lowest in years, after MSCI said Indonesia’s continued classification as an emerging market would be “no longer appropriate.”

Hong Kong’s Hang Seng gained 1.2% to 24,353.69. The Shanghai Composite index rose 1% to 3,742.66.

Australia’s S&P/ASX 200 was 1.1% higher at 8,812.90.

India’s Sensex edged up 0.2%.

On Thursday, Wall Street’s benchmark S&P 500 added 0.3%. The Dow Jones Industrial Average jumped 1.1%, and the technology-heavy Nasdaq composite rose 0.1%.

AI and chip stocks had eased their losses. American AI cloud provider CoreWeave plummeted as much as 9.5% in early trading but flipped later and ended 5.9% higher. Nvidia closed 1.8% lower following an earlier loss that reached 3.8%. Broadcom was down 0.6%, and AMD, or Advanced Micro Devices, was 1.5% lower.

Oil prices steadied but continued to stay elevated as global oil supply remains under pressure without a deal between the U.S. and Iran to end the Iran war.

The International Energy Agency also said Thursday its members agreed to release in a timely manner the remaining about 100 million barrels of oil outstanding from its pledge in March and that the release total amount to be released would exceed the original 400 million barrels planned.

Brent crude, the international standard, fell 0.4% to $105.46 per barrel. That is still higher compared with around $72 a barrel in late February before the start of the war.

Oil remains well-supported as uncertainties surrounding the situation in the Middle East and concerns over oil flows in the Strait of Hormuz had the market “pricing in a significant risk premium,” ING commodities strategists Warren Patterson and Ewa Manthey wrote in a commentary Friday.

The U.S. dollar fell to 157.83 Japanese yen from 158 yen. The euro was trading at $1.1228, up from $1.1220.

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AP Business Writer Stan Choe contributed to this report.