Japan, South Korea Stocks Hit Record Highs on AI Boom; Sensex Falls Nearly 500 Points as Indian Markets Lag Asia Rally

By Mahima Katal Stock markets in Japan and South Korea scaled fresh record highs on Monday, buoyed by investor optimism around artificial intelligence (AI) and advanced technologies, while oil prices climbed amid continued uncertainty over the fragile ceasefire between Iran and Israel.

Asian markets broadly traded higher, with technology stocks leading gains as investors continued to bet on strong demand for semiconductors and AI-related businesses. However, Indian equities bucked the regional trend, extending losses in afternoon trade amid broad-based selling across key sectors.

Japan's benchmark Nikkei 225 surged more than 1.3 percent, crossing the 67,000 mark for the first time and touching an intraday record of 67,231.28. Shares of SoftBank Group, which has significant investments in AI-related companies, jumped more than 9 percent after reaching record highs last week.

South Korea's Kospi index rallied nearly 5 percent to an all-time high of 8,874.16, supported by strong gains in technology shares. Samsung Electronics rose more than 9 percent after official data showed the country's exports surged 53 percent year-on-year in May, driven by robust global demand for semiconductors.

Over the past month, the Nikkei has gained more than 12 percent, while the Kospi has advanced over 27 percent, underscoring investor enthusiasm for AI-driven growth.

Elsewhere in Asia, Hong Kong's Hang Seng Index traded 0.9 percent higher at 25,408.96, while China's Shanghai Composite slipped 0.1 percent to 4,063.72 after data showed factory activity softened in May amid slowing export demand.

Taiwan's Taiex rose 1.4 percent and Australia's S&P/ASX 200 edged down 0.1 percent.

In contrast, Indian markets remained under pressure. At 2:33 pm, the BSE Sensex was down 492.43 points, or 0.66 percent, at 74,283.31, while the NSE Nifty declined 159.50 points, or 0.68 percent, to 23,388.25, slipping below the 23,400 mark.

Selling was concentrated in banking, capital goods, FMCG and automobile stocks, while technology shares continued to outperform and helped limit benchmark losses. Market breadth remained weak, with 2,507 stocks declining against 1,456 advances.

Meanwhile, oil prices extended gains as investors monitored ongoing US-Iran negotiations, including discussions on reopening the Strait of Hormuz, a critical route for global oil and natural gas shipments.

Brent crude, the international benchmark, rose 2.4 percent to USD 93.33 per barrel, while US benchmark crude climbed 2.8 percent to USD 89.76 per barrel. Oil prices have risen sharply since the outbreak of the Iran conflict earlier this year, adding to concerns about global inflation and economic stability.

Despite geopolitical uncertainties, strong corporate earnings and continued optimism surrounding AI-led growth have supported global equity markets, particularly in the technology sector.