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StreetAccount Summary - Asian Market Recap: Nikkei +2.68%, Hang Seng +0.86%, Shanghai Composite +0.87% as of 04:10 ET

May 22 ,2026

• Synopsis:

  • Asia equities ended higher Friday to end a volatile week. There were strong gains for Japan's Nikkei and Topix benchmarks while the Taiex and Kospi both rose again. Greater China traded higher as technology stocks led, Australia was also slightly better while India is also slightly higher. Southeast Asia stronger overall as Jakarta recovers some lost ground. US futures higher, Europe opened with gains. US dollar flat, little movement in Asia currencies. Treasuries and JGBs mixed. Crude oil higher again with Brent hovering around $105/bl. Precious metals lower, base metals quiet.

  • Asia equities ended higher for the week, propelled higher again by technology stocks in South Korea, Taiwan and Japan while laggards in Southeast Asia and Australia also gained. But the 'K-shaped' equity market returns evident in week-long data: the MSCI Asia Pacific ex Japan index gained around 1% as South Korea and Taiwan outperformed while Greater China and Australia fell and Indonesia declined sharply. And in Japan, the tech-heavy Nikkei 225 outperformed the broader Topix. The pressure elevated oil prices are exerting on inflation also evident this week on sovereign bond yields, several of which touched multi-year or record highs, and on currencies, with near- or near-record lows in the peso, rupiah and rupee.

  • The US-Iran stalemate remains in place with crude edging up Friday after Iran's supreme leader said the country's enriched uranium should stay in Iran and Tehran should maintain control of the Strait of Hormuz. Nevertheless, US Secretary of State Rubio said he saw good signs for a deal just as fresh reports emerged of vessels successfully transiting the strait. In regional macro developments Friday, Japan headline and core inflation were below expectations in large part because of energy and education subsidies but economists warned sharp increases lay ahead. South Korea consumer sentiment rose, supported by strong exports and the stockmarket rally. Indonesia posted its largest current account deficit in six years, highlighting the sharp narrowing of the trade surplus and the exodus of foreign funds.

  • Knowledge Atlas (2513.HK) released its latest LLM model to selected enterprise clients, sending its stock significantly higher. Nintendo (7974.JP) has asked partner and supplies to assemble around 20N Switch 2 consoles, 20% more than its public sales outlook mentioned, according to a Bloomberg report. Kawasaki Heavy Industries (7012.JP) to partner with Nvidia, Microsoft and others on physical AI development; stock sharply higher. Lenovo (992.HK) reported blowout earnings on expanding PC market share and growing contribution from AI server revenue. ASE Technology (3711.TT) benefiting form reports AMD will invest $10B in Taiwan to boost chip production capacity. The EU is to lift sanctions on Yangzhou Yangjie Electronic Technology (300373.CH) to prevent chip shortages in Europe's auto sector. Bharti Enterprises (05SK2L-E) is seeking UK government approval to increase its stake in BT Group to just under the takeover threshold. BYD (1211.HK) in talks with Formula One management over entering the sport

• Digest:

  • US and Iran said to have narrowed gaps as talks continue:

    • Media reports noted signs of progress in US-Iran negotiations with gaps between two sides said to have narrowed (Reuters, Bloomberg). Iran has yet to formally respond to US proposal though Secretary of State Rubio noted some good signs in talks. Details murky with Iranian press circulating report by Al-Arabiya claiming draft includes end to conflict on all fronts, freedom of navigation in Strait of Hormuz under joint monitoring mechanism, gradual lifting of sanctions conditioned on Iranian compliance with deal, and negotiations on outstanding issues to begin within maximum seven days.

    • However, divisions remain on key sticking points of uranium enrichment and stockpiles and control over Strait of Hormuz. President Trump said US will obtain Iran's HEU stockpiles, coming after Reuters sources said earlier Supreme Leader Khamanei insisted all enriched uranium remain inside Iran. Trump said he wanted Hormuz opened and not subject to tolls despite Iran's continued assertion of control over the waterway and its claim of talks with Oman about establishing permanent tolling system (Bloomberg). Rubio said tolling would make deal unfeasible.

    • Oil swung on the headlines, rallying earlier on reports about Iranian leadership calling for enriched uranium to stay in country before turning lower on headlines two sides close to ceasefire agreement. There remains skepticism whether two sides can meaningfully bridge differences and Trump threatened to resume hostilities if Iran doesn't come to satisfactory agreement. Earlier this week Trump suspended imminent strikes against Iran to allow more time for talks though warned US military prepared to strike in moment's notice if no deal is reached.

  • Japan CPI inflation softer than expected, though Middle East pressures loom:

    • Nationwide core CPI rose 1.4% y/y in April, lower than consensus 1.7%. Follows 1.8% in the previous month, marking the lowest since Mar-22. Deceleration was somewhat more pronounced than the advanced Tokyo figures. Energy drags eased by 0.14 ppt reflecting smaller declines in electricity & gas. Policy measures net of base effects posed a drag of 1.08 ppt on the headline and contributions now coming mainly from the gasoline price cap (0.87 ppt) and kerosene subsidies (0.19 ppt) while impact from electricity & gas subsidies has diminished. Sharp sequential 10.6% m/m rise in electricity prices likely reflected market price adjustments. Biggest source of moderation came from lower non-fresh food contribution amid ongoing deceleration. Broadest rice category climbed by less than 1%, the smallest increase since the upturn began in Dec-22. Base effect headwinds still set to peak in May-Jun when prices doubled on the year. Levels are off about a quarter from their highs, though still double the period before supply shortages became acute. In terms of implications, fading near-term momentum running up against elevated forecasts prompted by the Middle East situation. JCER consensus sees the 1.8% in Q1 core CPI as the trough, with Q2 projected to average 2.0% enroute to a peak of 2.7% in 1Q27. While BOJ does not publish quarterly forecasts, Outlook Report noted that core CPI is likely to be in the range of 2.5-3.0% in FY26 stemming from higher crude oil prices and the average forecast was revised up significantly to 2.8% from 1.9%. Broader supply chain pressures were noted as factors skewing the risks to the upside.

  • Seoul warns over 'excessive' won moves and says it will act:

    • South Korea's finance minister and Bank of Korea officials said they were 'closely' monitoring won-US dollar exchange rate, calling recent moves 'excessive relative to economic fundamentals' (Bloomberg). Joint statement said they would 'take decisive actions if necessary' however verbal intervention failed to stop intraday weakening as won fell almost 0.8% versus US dollar to near one-year low. Won at 1,516 per dollar in late afternoon trade just as Brent crude price maintained elevated levels near $110 per barrel (Yonhap). Verbal warning was first from Seoul since Dec-25. Analysts said weakening partially result of strong US dollar but currency remained sensitive to risk sentiment, which is currently being driven by oil prices. Also noted overseas selling of large-cap semiconductor stocks has failed to offset improved sentiment surrounding economy, while higher CPI likely to lead to BOK monetary tightening sooner rather than later.

  • Physical AI advancement fuels rally in Asian robotics stocks:

    • Physical AI theme getting more traction following optimistic remarks by Nvidia CEO Jensen Huang this week about AI phase eventually moving from hyperscalers to robotics and automation.

    • Nvidia marking presence in this space with Nikkei sources saying company is partnering with Kawasaki Heavy Industries (7012.JP) to develop robotics solutions, focusing initially in medical and mobility fields utilizing Nvidia's simulation technology. Comes after Nvidia reportedly held talks with LG Electronics (066570.KS) about partnership agreement to develop humanoid robots (Reuters).

    • Last week FANUC (6954.JP) announced strategic collaboration with Google to build physical AI robot system based on Gemini (Bloomberg). South Korea's government reportedly held talks with Hyundai Motor (005380.KS) about deploying robotics in noncombat roles.

    • Partnership headlines have made Korean robotic firms among best performing stocks in May with LG Electronics up 69% mtd. FANUC the standout in Japan, up 19% mtd.

    • Some thought Asia' strong manufacturing base and technological advancement in robotics positions region for fastest growth in global physical AI market over coming years (link).

  • China's state funds expected to cut more ETF holdings in H1:

    • Bloomberg Intelligence analysis showed China's so-called National Team is set to cut its holdings of ETFs that track onshore stocks by about 90% in H1 2026. State-backed funds have already offloaded about $170B of ETFs YTD, including $30B since start of April. More sell orders are expected with full liquidation could take at least eight weeks as state funds intend to cut stakes in several ETFs below 20% threshold, where no disclosure required for H1 filings. CSI 300 remains the only major index where National Team still holds notable stakes, while the expected unwinding likely to weigh on its performance. Noted move suggests continued effort to cool down perceived market froth while reserving enough dry powder to support market during downturns (HKEJ). Noted National Team's selling is being offset by increased buying from a number of other investors. Onshore market has seen more stock account openings by retail investors and faster-than-usual increase in deposits at non-bank financial institutions. Separate Bloomberg analysis also saw foreign investors return to onshore stocks in April with estimated net inflows at around CNY200B ($29B). Analysts note broad market indicators remain strong and resilient despite National Team's redemptions. Shanghai Composite hit 11-year high in mid-May while China's tech-focused indexes, including ChiNext and STAR 50, both hit record highs earlier this month.

  • Notable Gainers:

    • +19.8% 992.HK (Lenovo Group): reports Q4 results; revenue, operating income beat StreetAccount estimates

    • +10.0% 3711.TT (ASE Technology Holding): Advanced Micro Devices suppliers trading higher, on announcement company will invest $10B in Taiwan

    • +6.3% 5706.JP (Mitsui Kinzoku): revises medium term business plan; guides FY27 ROE 17% vs prior 14%

    • +6.0% 2408.TT (Nanya Technology): reportedly guides FY capex to exceed NT$52.0B

    • +5.7% 9999.HK (NetEase): reports Q1 non-GAAP EPADS CNY17.46 vs FactSet CNY15.12

    • +4.5% 7012.JP (Kawasaki Heavy Industries): reportedly to partner with Nvidia to develop solutions that integrate robotics with physical AI

  • Notable Decliners:

    • -12.9% 303.HK (VTech Holdings): reports FY net income attributable $134.1M, (14%) vs year-ago $156.8M

    • -12.0% 412.HK (Shandong Hi-Speed Holdings Group): to sell its entire 38.8% stake in VNET Group for $942.2M cash

    • -5.0% 3003.JP (Hulic Co.): to conduct secondary offering (for holders) of 17.4M shares in international markets; offering priced at ¥1,650/share

    • -0.5% 7974.JP (Nintendo): reportedly requests assembly of 20M Switch 2 units from suppliers and partners for this FY

  • Data:

    • Economic:

      • Japan April nationwide core CPI +1.4% y/y vs consensus +1.7% and +1.8% in prior month

        • CPI excl. fresh food & energy +1.9% y/y vs consensus +2.2% and +2.4% in prior month

        • Overall CPI +1.4% y/y vs consensus +1.6% and +1.5% in prior month

      • New Zealand Q1

        • Retail sales q/q +0.9% versus +0.9% in prior quarter

    • Markets:

      • Nikkei: 1,654.93 or +2.68% to 63339.07

      • Hang Seng: 219.51 or +0.86% to 25606.03

      • Shanghai Composite: 35.62 or +0.87% to 4112.90

      • Shenzhen Composite: 62.41 or +2.23% to 2862.78

      • ASX200: 35.30 or +0.41% to 8657.00

      • KOSPI: 32.12 or +0.41% to 7847.71

      • SENSEX: 531.68 or +0.71% to 75715.04

    • Currencies:

      • $-¥: +0.13 or +0.08% to 159.1110

      • $-KRW: +11.78 or +0.78% to 1516.3550

      • A$-$: (0.00) or (0.28%) to 0.7130

      • $-INR: (0.26) or (0.27%) to 95.9241

      • $-CNY: (0.01) or (0.10%) to 6.7966