Asian Stocks Hit Records; Robotics Emerges as Hottest Theme Beyond Chip Makers on Physical AI Wave

Asian equity markets are experiencing a record-breaking surge as artificial intelligence enthusiasm broadens beyond memory chips to encompass robotics and automation stocks, signaling a shift in how markets are pricing the structural AI opportunity. South Korea's Kospi index briefly breached the 8,000 mark Friday, an 8-year milestone, having rocketed 1,000 points in just seven trading sessions. This velocity has drawn some caution from foreign investors, who are now selectively reducing positions after two consecutive sessions of gains, signaling profit-taking ahead of what could be a volatile weekend.

Taiwan's stock market is drawing fresh institutional conviction. JPMorgan raised its target for Taiwanese equities to 50,000 on the assessment that Taiwan offers the purest play on global AI buildout, a view reinforced by Meta's $21 billion CoreWeave deal and sustained capex guidanceCompany-issued forecasts of future financial performance. from major US tech firms. However, the rally is becoming increasingly stretched, and some analysts are flagging valuation excess. Malaysia raised its GDP growth forecast and noted AI adoption as a key driver, while Singapore home sales surged to a six-month high despite the Middle East conflict, suggesting regional risk appetite remains intact.

China's equities and currency showed little reaction to the Trump-Xi summit, halting their modest rally instead. This lack of enthusiasm from Chinese investors suggests that the summit's trade truce and agriculture commitments are being treated as non-events by local markets, or that concerns about growth and capital flows are outweighing the regulatory relief from the CLARITY Act. Foreign investors are continuing to reduce their South Korean holdings even as the index climbs, a classic divergence between momentumThe empirical fact that winners keep winning over the medium term. and conviction.

The narrative is vulnerable to a sharp pullback if valuations reset downward or if AI capex guidanceCompany-issued forecasts of future financial performance. disappoints. Asian stocks have already priced in substantial AI tailwinds; any sign of satiation or slower spending could trigger rapid profit-taking across the region, especially in South Korea where the velocity has been most extreme.