For years investors have bemoaned Australia’s lack of exposure to the global artificial intelligence trade, which has been a key reason for the sharemarket’s lacklustre performance when compared with that of the United States or Asia.
But what was once the ASX’s biggest weakness has suddenly turned into an advantage as cracks start to appear in the dazzling semiconductor trade unleashing a rotation of capital away from Asia’s booming tech sector and back into the local exchange.
That trend was particularly pronounced on Tuesday, when South Korea’s world-beating Kospi index plunged almost 11 per cent – at one point triggering a temporary trading halt – and has helped erase about a third of its value over the past month.
While Australia’s S&P/ASX 200 Index shed 34 points in the opening minutes of trade on Tuesday, it rallied hard off its lows as the sell-off in South Korea reached fever pitch, and finished the session 54 points higher with its largest stocks accounting for most of that increase.
“It looked like possibly a big international fund had had enough of Asia and was pulling money out of there and putting it into Australia,” said Bell Potter’s director of institutional sales and trading, Richard Coppleson.
Source: https://www.afr.com/markets/equity-markets/wouldn-t-be-short-for-quids-investors-return-to-asx-amid-chip-sell-off-20260729-p60jje