In the dynamic landscape of Asia-Pacific stock markets for 2024, Taiwan has emerged as the frontrunner, propelled by significant advancements in artificial intelligence (AI) technologies. The Taiwan Weighted Index has surged impressively by 28% year-to-date, driven by robust performances across the AI value chain.
Key players like Taiwan Semiconductor Manufacturing Corp. (TSMC) and Foxconn (Hon Hai Precision Industry) have notably contributed to this growth, with TSMC climbing 63% and Foxconn soaring by an impressive 105% in the first half of the year.
Rahul Ghosh, a global equity portfolio specialist at T. Rowe Price, highlighted, “The performance of global markets this year has been largely driven by the themes of Artificial Intelligence and central bank policy, and that is likely to continue.” The widespread impact of AI investments is extending into diverse sectors such as industrials, materials, and utilities, underscoring Taiwan’s strategic positioning in tech-driven growth.
In contrast, Japan’s Nikkei 225 index secured the second spot in the region, buoyed by surpassing historic highs multiple times in 2024. With an 18% gain year-to-date, Japan’s market optimism is underpinned by robust corporate governance reforms and positive macroeconomic indicators.
Analysts foresee continued momentum in Japan, with favorable conditions including the Bank of Japan’s confidence in meeting inflation targets and prospects for gradual monetary policy normalization.
While most Asian markets have seen positive gains, markets in Thailand, Indonesia, and the Philippines faced challenges, with declines recorded in their respective indices.
The future trajectory of these markets remains closely tied to decisions by the U.S. Federal Reserve, particularly regarding interest rate adjustments. Current expectations suggest a potential rate cut in September, with ongoing assessments influenced by global economic conditions and inflation trends.
As Asia navigates these economic dynamics, Taiwan’s leadership in AI-driven innovation and Japan’s resilient market recovery highlight distinctive paths amidst broader regional trends.
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