Asian Stocks Climb on AI Demand as Oil Slips and Dollar Holds Firm

Asian equities advanced for a sixth consecutive session on Wednesday, lifted by continued evidence of consumer appetite for artificial intelligence applications, while crude prices weakened on indications of additional Middle Eastern supply and the dollar held near multi-week highs after hawkish remarks from Federal Reserve officials.

South Korea's benchmark gained 1.2%, with Samsung and SK Hynix each rising more than 2%. Taiwan added 0.9%, approaching record territory. The broadest gauge of Asia-Pacific shares outside Japan climbed 0.7%. Chinese blue chips were little changed. Japanese markets were shut for a holiday, but Nikkei futures traded near 66,745, roughly 2,000 points above the cash index's last close on Friday.

Analysts pointed to memory-chip makers taking a leadership role, supported by a sixth straight session of gains in semiconductor shares. The hardware segment has drawn strength from heavy consumer adoption of Meta's Muse agent, which has led US app download charts over the past two weeks. Attention is now turning to how a comparable offering from Google Labs, known as CC, performs with users.

On Wall Street, S&P 500 and Nasdaq futures held steady. European futures were firmer, with EUROSTOXX 50 and DAX contracts up 0.3% and FTSE futures up 0.2%.

Oil prices retreated after reports that Saudi Arabia had restarted operations at its East-West Pipeline and may have already resumed exports from the Red Sea port of Yanbu. Brent futures eased 0.1% to $99.18 a barrel, while US crude fell 0.4% to $90.14. US President Donald Trump said talks with Iran in New York had made progress but also threatened to "annihilate" the country if no deal was reached. Iranian President Masoud Pezeshkian was due to address the UN General Assembly later on Wednesday, with markets watching for a possible meeting with Trump.

Chinese President Xi Jinping was scheduled to arrive in Washington later in the day amid speculation that a trade truce between the two countries could be extended and that cooperation on AI might emerge.

The softer oil market helped Treasury futures edge higher, keeping 10-year yields below the 5.0% threshold. Two-year yields, however, touched their highest since mid-2024 at 4.7879% as investors weighed the risk of further Fed tightening. Richmond Fed President Tom Barkin and Boston Fed President Susan Collins both expressed support on Tuesday for last week's rate increase, citing inflation concerns. Futures markets imply a 54% probability of another hike in October and have priced in 33 basis points of tightening by year-end.

The rate outlook supported the dollar, which reached multi-week peaks against the euro, sterling and the Canadian dollar. The euro was pinned at $1.1440, near a two-month low. The dollar was slightly firmer on the yen at 157.60, with traders cautious about provoking Japanese intervention above the 160.00 level.

Analysts also flagged that Trump's call to ban US diesel exports could worsen European inflation, given the region's reliance on American fuel shipments, and noted Europe's existing natural gas shortage as a risk to winter energy prices.

In commodities, gold eased 0.3% to $4,341 an ounce, while copper traded near record highs after gaining 18% so far this year.