Asia Stocks Bounce on Chip Optimism Despite Fed Looming

Emerging Asia shares received a boost from chip-heavy South Korea and Taiwan as investors braced for a widely expected Federal Reserve rate hike. The US dollar held near a two-week high, but the market's focus was on how long high US rates might stick.

South Korea rose 1.4% and Taiwan 0.7%, driven by optimism around AI-related memory chips and a weaker won, which can translate into bigger local-currency earnings for exporters like Samsung Electronics and SK Hynix.

The dollar index hovered around 99.59, and the won slid as much as 0.8% to 1,372.80 per dollar, a reminder that currency moves can quietly offset stock gains for global investors.

Investors were pricing more than 90 basis points of additional hikes through to September 2027, according to Christopher Wong at OCBC, a Singapore bank.