Investors Turn to Taiwan and South Korea for Asian Equities Rally

Investors are turning to Asian equities for the next leg of the global stock rally, with Taiwan and South Korea emerging as key targets because of their exposure to artificial intelligence hardware, Bloomberg reported.

The Asian equities rally has lifted shares in both markets, helped by gains in Samsung Electronics, SK Hynix and Taiwan Semiconductor Manufacturing Co.

Derivatives strategists are recommending bullish trades on Taiwan’s TAIEX, South Korea’s KOSPI 200 and Japan’s Nikkei 225, while rising demand has pushed up options costs and implied volatility.

JPMorgan strategists said AI hardware remains the earnings backbone of the theme, with Taiwan the most efficient index-level proxy for the rally.