Regional Markets Show Divergence as Tech and Banking Lift India and Korea, While Hong Kong and Australia Decline

Asian stock markets opened Friday, June 7, 2025, with a mixed performance, as investors weigh global macroeconomic concerns against strong sectoral momentum in some countries. India’s Sensex and South Korea’s KOSPI led the region with solid gains, while Hong Kong’s Hang Seng and Australia’s ASX 200 opened in the red. Currency volatility, central bank expectations, and earnings trends are contributing to the varied outlook across the continent.

India’s Sensex Hits New High Amid Economic Optimism

India’s S&P BSE SENSEX rose 0.92% in early trading to 82,188.99, supported by ongoing domestic economic strength and favorable corporate earnings. The rally is driven primarily by banking, financial services, and consumer sectors, all of which are showing resilience in the face of global volatility.

Investors are responding to robust GDP growth forecasts, declining inflation, and a stable policy environment. Foreign institutional inflows continue to provide support, cementing India’s role as a regional outperformer.

South Korea’s KOSPI Climbs on Semiconductor Momentum

The KOSPI Composite Index in South Korea jumped 1.49% to 2,812.05, driven by continued demand for semiconductors and advanced tech stocks. Korea’s equity markets have benefited from the global acceleration in AI and cloud infrastructure, which has renewed interest in major chipmakers.

The export-driven Korean economy is showing resilience, and investor sentiment remains positive on expectations of strong Q2 earnings for the tech sector.

Nikkei 225 Gains Despite Yen Weakness

Japan’s Nikkei 225 advanced 0.50% to 37,741.61, despite the Japanese yen weakening sharply. The Japanese Yen Index dropped 0.95% to 69.02, reaching a multi-week low. While the weaker yen increases inflationary pressure domestically, it also boosts the competitiveness of Japanese exporters — especially automakers and industrial firms — which lifted the index.

Investors are awaiting next week’s Bank of Japan meeting, where new guidance could be issued in response to currency trends and inflation risks.

Shanghai Edges Higher as Policy Hopes Persist

China’s SSE Composite Index rose modestly by 0.04% to 3,385.36, reflecting cautious optimism among investors. Market participants are looking for more targeted stimulus from Beijing amid slow economic recovery and uneven consumption data. Gains were limited to infrastructure, utilities, and selective consumer-related stocks.

Australia’s ASX 200 Declines as Commodities Weigh

The S&P/ASX 200 [XJO] fell 0.27% to 8,515.70, led lower by weakness in mining, energy, and financial sectors. The decline comes as global commodity prices remain soft, and investors digest the Reserve Bank of Australia’s recent dovish tone.

The Australian Dollar Index also slipped 0.26% to 64.92, signaling lower export demand expectations and weaker sentiment in the resources sector.

Hong Kong’s Hang Seng Drops on Tech Weakness

Hong Kong’s Hang Seng Index dropped 0.48% to 23,792.54, dragged down by Chinese tech stocks which reversed earlier gains. Market participants are increasingly concerned about ongoing regulatory uncertainty and a lack of clear economic direction from Beijing.

Foreign investors are trimming exposure to Hong Kong-listed tech firms as they await clarity on the government’s fiscal roadmap.

Currency Highlights: Yen Weakens, Aussie Dollar Softens

Currency markets are also shaping equity sentiment across Asia:

• The Japanese yen continues to fall, adding pressure on Japan’s domestic costs.
• The Australian dollar is slipping amid commodity headwinds and a soft growth outlook.

These trends are influencing regional capital flows and could shape central bank policy in the coming weeks.

Outlook: Regional Performance Reflects Diverging Fundamentals

As the Asian session progresses, investor focus remains on:

• Global inflation trends
• Upcoming U.S. jobs report
• Currency stability and policy guidance

India and Korea are clearly benefiting from strong economic data and sectoral momentum, while Australia and Hong Kong struggle with commodity pressures and tech weakness. Market divergence will likely persist as central banks and governments navigate inflation, growth, and external shocks.