South Korea, Taiwan and Japan are just happy they make the equipment AI runs on, so sky-high capex is all earnings to them. The Kospi is already up almost 5% this week at a fresh record, bringing its gains for 2026 to 44%. Taiwan's gains are 5% and almost 22%, respectively. Eat your heart out, Nasdaq!
The Nikkei is up 15% on the year so far and getting a lot of good press from analysts calling for a re-rating of Japan Inc on better earnings and governance. Deutsche notes Japanese investors hold $2.25 trillion in foreign shares and even a modest shift to domestic stocks would be a potential bonanza for the Nikkei and the yen.
Much now depends on AI-diva Nvidia, which reports later today, and how far it can beat expectations. Going by LSEG data, forecasts are for profits to rise 62% in the quarter to end January, and revenue to jump 68%.
First-quarter revenue guidance is for a rise of about 64% to $72 billion. Nvidia has outpaced sales forecasts for 13 straight quarters, so it's the size of the beat that matters, with $2 billion on both Q4 and Q1 guidance being a bare minimum.
Options imply a share move of +/-4.8% on the results, which would actually be tamer than in the recent past but then its market cap is so much larger. In this case, 4.8% equals $226 billion in value. Nvidia's total market cap of $4.7 trillion tops the annual GDP of Japan or India.
