Asian stocks rise as tech bounces from rout, Warsh upbeat on AI

Hong Kong – Most Asian markets bounced Friday after the previous day’s tech rout fuelled by concerns over the AI boom, which Federal Reserve boss Kevin Warsh said offered huge benefits to the global economy. Seoul and Tokyo enjoyed healthy gains in early exchanges boosted by chipmakers SK hynix and Kioxia, after having been pummelled Thursday as investors bailed out of the once-dominant AI sector. The selling had been fuelled by forecast-beating US inflation data that ramped up bets on Fed interest rate hikes, as well as concerns about the financial health of data centre operator CoreWeave owing to its huge debt pile. The New Jersey firm — which has borrowed heavily to finance hefty purchases of pricey semiconductor chips from Nvidia — tanked 15. 5 percent Wednesday in the US as yields on some of its bonds soared, reflecting heightened angst over its future.

That added to concerns about the whole AI-tech complex, but Nvidia chief Jensen Huang on Thursday lifted spirits by defending the company and its health. “CoreWeave’s strength is improving every day,” he told Bloomberg. “I’m optimistic. Their cost of capital is actually decreasing. ” CoreWeave’s shares climbed almost six percent. Huang’s “defence of CoreWeave’s financial position was enough to pull the NeoCloud complex off the floor, drag AI equities higher and give the broader market something resembling a pulse”, wrote SPI Asset Management’s Stephen Innes. “One moment the market was pricing the possibility that the AI financing machine had started eating its own tail, the next it was listening to the high priest of the boom explain that the patient was getting stronger. “AI Jesus had entered the trading room and, for a while at least, the machines found religion again. ” Seoul jumped more than two percent and Tokyo…