Tokyo and Seoul ripped higher on AI capex enthusiasm overnight while oil and Iran headlines kept the US tape in risk-off mode heading into inflation week.
Nikkei jumped over 2% to roughly 66,400 on a tech-led surge, with SoftBank, Advantest and Kioxia all posting double-digit-to-mid-single-digit gains on AI infrastructure optimism, while KOSPI ripped over 4% as Samsung and SK Hynix rallied on the same memory/AI-demand story. Hang Seng lagged and slipped as energy and education names fell on rising oil, and CSI 300 was modestly firmer, helped by a strong August export print. In FX, the yen extended its grind stronger, with USD/JPY pressing toward the mid-150s on building bets for a BOJ hike at the September meeting, while USD/CNH sat in a tight range as the PBoC kept the fix steady.
The read-through into the US was uneven: Nasdaq futures outperformed on chip strength tied to a fresh Qualcomm-AWS AI infrastructure tie-up, but Dow and S&P lagged as Brent pushed toward the high-$90s and WTI cleared $93 on renewed Iran-US friction and fresh Canada tariff retaliation. Cash finished lower for a second straight session, with 10-year yields near 4.80% as markets now price real odds of a hike, not a cut, at the September 15-16 FOMC, all ahead of PPI Thursday and CPI Friday.
The risk: a Brent breakout above the $100 handle or a hot CPI print that hardens hike odds breaks the "AI offsets macro" bid and drags Nasdaq leadership down with the rest of the tape; a Mideast de-escalation or soft CPI flips this straight back to broad risk-on.