"Effort for Rise in Asian Stock Markets and Concerns Over AI Bubble"

Asian investors struggled to initiate a stock market recovery impacted by global market concerns over artificial intelligence bubbles and uncertainty surrounding U.S. interest rates. November was tough amid speculation that the technology-driven rally had progressed too far and that valuations needed correction.

Any issues with companies in the Seven Group, including Amazon, Meta, Alphabet, and Apple, which comprised a significant portion of this year’s rally, have the potential to create large waves in the markets. Therefore, Nvidia's earnings report, expected to reach a valuation of 5 trillion dollars this month, is eagerly anticipated.

Investors are concerned that signs of weakness could signal a burst of the artificial intelligence bubble. Stephen Innes from SPI Asset Management stated, “The AI complex, undoubtedly the locomotive of the 2025 rally, is now sounding like a shaky engine.” He indicated that this situation reflects an awareness of how to descend through thin air when financial movements occur at high altitudes, rather than indicative of panic or collapse.

Additionally, a survey conducted by Bank of America revealed that more than half of fund managers believe artificial intelligence stocks are already in a bubble. Furthermore, 45% of participants viewed this bubble as the biggest "risk of success" for the markets.

BBC published an interview with Alphabet CEO Sundar Pichai, who stated that if the artificial intelligence bubble were to burst, every company would be affected. Recently experiencing a turbulent exit, Asia found some stability during moments of fluctuation between gains and losses.

Tokyo showed a small increase while tensions with China and uncertainties over Japan’s fiscal situation drew attention ahead of an economic stimulus package that pushed government bond yields to record levels. Hong Kong, Shanghai, Sydney, Singapore, Taipei, and Manila were up, while Seoul, Wellington, and Jakarta lost value.

This week, markets are awaiting significant U.S. data regarding job creation. Investors reduced their expectations for another interest rate cut after many decision-makers, including Federal Reserve Chairman Jerome Powell, approached the necessity of another cut with questions due to persistent inflation.