Asian equity markets just had a week that will make it into the highlight reel. Japan’s Nikkei 225 and South Korea’s KOSPI both punched through to fresh all-time highs on June 19, fueled by a combination of falling oil prices, booming semiconductor stocks, and a US dollar that’s flexing muscles it hasn’t shown in over a year.
The Nikkei closed up 0.8% on the day, which sounds modest until you zoom out: that’s the fifth consecutive record session, capping off an 8.5% weekly gain. The KOSPI was even more impressive, surging 3.1% in a single session and posting a jaw-dropping 15.3% gain for the week.
What’s driving the rally
Two words: oil and chips. The initial catalyst was a sharp decline in crude prices, triggered by de-escalation in the Middle East and the reopening of the Strait of Hormuz. Cheaper energy is a direct tailwind for manufacturing-heavy economies like Japan and South Korea, where fuel costs eat into corporate margins.
On the South Korean side, the gains were heavily concentrated in semiconductor stocks. SK Hynix and Samsung Electronics, both major players in AI-related chip production, powered the KOSPI’s ascent.
