AI-related shares fared well in Asia on Thursday after a raft of generally positive earnings reports while surging oil prices left bonds ⁠battered as central banks turned more hawkish on inflation and interest rates.

In Hong Kong, the benchmark Hang Seng Index opened down 103 points, or 0.4 percent, at 26,008. It was 290 points, or 1.11 percent, down 25,821 at one point in mid-morning trades.

The China enterprises index was 47 points, or 0.5 percent, lower at 8,757 while the tech index was 33 points, or 0.7 percent, lower at 4,876.

Up north, the benchmark Shanghai Composite Index was flat in opening trading at 4,107.

The Shenzhen Component Index was up 36 points, or 0.24 percent, higher at 15,157 while the ChiNext Index, tracking China's Nasdaq-style board of growth enterprises, was up 0.46 percent at 3,704.

Investors feared the European Central Bank and Bank of England would likely warn of higher rates later in the day after three US Federal Reserve members voted to drop its easing bias in the most divided decision since 1992.

Outgoing Fed chairman Jerome Powell also confirmed he would stay on as a governor for now to defend the institution's independence as his successor Kevin Warsh, hand-picked by US President Donald Trump, who wants lower interest rates, moves toward confirmation.

Markets were quick to price out any rate cuts from the Fed this year, and there is a roughly even chance of a hike by next spring. US Treasury yields rose to a ⁠one-month high and the dollar gained broadly, hitting over 160 yen.

The latest spike in oil prices ⁠was a cause for concern, as Brent ⁠Crude futures jumped 6 percent overnight to a four-year high of US$122.53 a barrel on worries that the Strait of Hormuz might not open anytime soon.

"Macroeconomic risks are significant at this juncture, but stock-market bulls hope a rosy path ⁠for artificial intelligence can continue to offset cyclical weakness," said Jose Torres, senior economist at Interactive Brokers.

"If earnings, capital expenditures and outlooks are buoyant, investors could remain sanguine even as the threat of a slowdown in overall activity, loftier borrowing costs and widening credit spreads raise eyebrows."

In Asia, Nasdaq futures rallied 1 percent as earnings from Google parent Alphabet topped forecasts, sending its shares up 7 percent in extended trading. ⁠Results from Microsoft and Amazon.com were also solid, raising hopes for Apple later in the day.

Meta Platforms disappointed as it raised its annual capital spending forecast to plough billions more into artificial intelligence infrastructure, sending its shares down 7 percent.

MSCI's broadest index of Asia-Pacific shares outside Japan was flat on Thursday, but was still set for a whopping 16 percent gain this month. Japan's Nikkei fell 1% but was up a similar 16 percent in April.

In Tokyo, the Nikkei Stock Average opened down 432 points, or 0.72 percent, at 59,484 but was up a similar 16 percent in April. The 225-issue benchmark was down 561 points, or 0.94 percent, at 59,356 at one point before noon.

In Seoul, the Korea Composite Stock Price Index opened up 48 points, or 0.72 percent, at 6,739, with Samsung Electronics saying its operating profit jumped eightfold to a record on robust AI demand, before running into some profit-taking. The Kospi shed its gains to be 18 points, or 0.27 percent, up at 6,709 at one point before midday. (Reuters & Xinhua)



Edited by Robert Kemp