Asian stocks displayed mixed performance on Monday, with South Korean shares declining due to renewed concerns in the memory-chip sector. The KOSPI index fell 3.5%, while Hong Kong's Hang Seng rose 0.2%, and China's CSI 300 slipped 0.8%. Trading volume was reduced, as Japan's cash equity markets were closed for Sports Day, and U.S. bond markets were shut in observance of Columbus Day.

Read More

On Friday, Wall Street achieved record highs, with the S&P 500 rising 0.6%, the Dow Jones Industrial Average increasing by 0.8%, and the Nasdaq Composite up 0.6%. In Asian pre-market trading, Nasdaq 100 futures climbed by 0.2% to 31,163.25, and S&P 500 futures also gained 0.2% to 7,877.75. Market participants are anticipating U.S. consumer and producer inflation data, as well as retail sales figures this week, which are expected to influence the Federal Reserve's future decisions. Current market pricing reflects an 18% likelihood of a Fed rate hike this month and an 85% chance of an increase in December.

The decline of South Korea's KOSPI was driven by significant drops in key chip companies, with SK Hynix down 2.6% and Samsung Electronics dropping 2.3%. LG Innotek experienced a dramatic decline of 13.1%. This downward trend comes after a report detailing advancements by Chinese memory-chip maker ChangXin Memory Technologies (CXMT) in their 4F² DRAM architecture, which aims to enhance memory density. CXMT is expected to launch next-generation DDR5 server-memory modules by the year-end, potentially increasing competition in the higher-value server-memory market with established players like Samsung and SK Hynix. TrendForce estimates that this new design could boost memory density by 30%-50%.

In the broader technology sector, shares showed varied results. Largan Technologies surged by 8%, while Foxconn gained 2.6%, and Taiwan Semiconductor Manufacturing Company (TSMC) decreased by 0.4%. TSMC's upcoming results on Thursday are highly anticipated, with analysts predicting a record sixth consecutive quarter of earnings, largely driven by demand for AI chips and advanced CoWoS packaging, with expected third-quarter net profits of T$746.3 billion ($23.4 billion), reflecting a 65% year-over-year increase.

Geely Automobile shares increased by 2.5% after announcing its entry plans into Canada, with the first vehicle sales targeted for 2027. Additionally, China and the EU have reached a 16-point consensus on trade, investment, export controls, and intellectual property, including Beijing's agreement to limit hybrid car exports amidst the EU's considerations of safeguard measures.