Asian stocks surge as KOSPI rebounds on AI optimism

Asian stock markets surged on Friday, July 31, 2026, led by a record rebound in South Korea's KOSPI, as strong earnings from major U.S. technology companies restored investor confidence in artificial intelligence investments. The rally followed a steep selloff earlier in the week and occurred alongside currency market interventions and a key central bank decision in Japan.

South Korea's benchmark KOSPI index leapt over 14%, propelled by massive gains in technology giants SK Hynix and Samsung Electronics. Japan's Nikkei 225 climbed between 3.5% and 5%, while the broader MSCI Asia-Pacific index outside Japan also rose sharply. Analysts attributed the recovery to stronger-than-expected earnings and forecasts from Microsoft and Amazon, which reassured markets that demand for AI infrastructure remains resilient despite recent concerns over rising capital expenditures.

Market participants suggested the earlier decline appeared to have been an overreaction. One analyst noted the AI demand story still seems sustainable and that the selloff may have been the market overreacting to concerns around capital spending. Despite the strong single-day rally, the KOSPI was still on track for its...