Asian equities rebounded as risk sentiment improved after a multiday global tech selloff, though concerns about aggressive artificial-intelligence spending linger.
"Risk sentiment in markets stabilized overnight, although under the hood there remains concerns around the sustainability of the AI trade," MUFG analyst Michael Wan said in a note.
South Korea's Kospi rose 3.65% early Wednesday and Japan's Nikkei Stock Average was up 1.8%. Hong Kong's Hang Seng Index gained 1.1% and China's Shanghai Composite Index edged 0.1% higher.
Strong earnings reports from SpaceX and Super Micro Computer overnight injected a dose of confidence into markets. However, Anthropic's more-than $80 billion net loss in the first half of 2026 and a long list of risk factors, according to a draft prospectus viewed by The Wall Street Journal, have kept investors cautious.
Markets are increasingly focusing on AI-related companies' balance-sheet health and credit cycle in addition to their robust growth. The more-than 30% dive in Seoul-based AI cloud-computing company Elice's shares on the first day of trading Tuesday shows mounting market concerns over debt-financed AI infrastructure investments, analysts said.
"The market is increasingly asking not only whether AI demand is real, but who is funding it, on what terms and with what margin of safety," Tickmill Group market strategy partner Patrick Munnelly said in a note.
Oil rose in early Asian trade after Iran's Islamic Revolutionary Guard Corps said Tuesday that it struck two oil tankers attempting to cross the Strait of Hormuz, according Iranian state media reports.
Front-month WTI crude oil futures rose 0.7% to $98.51 a barrel, while front-month Brent crude oil futures were 0.7% higher at $109.51 a barrel.
Persian Gulf oil exports have surpassed prewar levels, as an improvised shipping system under U.S. protection is helping tankers move oil through one of Iran's fiercest waves of attacks in the Strait of Hormuz. Still, oil prices remain high, as traders are concerned the improvement in Hormuz might not be sustainable.
The Trump administration has also been keen to damp hostilities in the Middle East as well as between Russia and Ukraine leading into the midterm elections, as energy prices are a key issue for voters, ANZ Research analysts said in a note.
Precious metals declined amid pressure from rising crude prices, which keep inflationary pressures in place. Spot gold dropped 0.3% to $4,110.75 a troy ounce and spot silver was down 0.8% at $57.52 a troy ounce.
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