Asian Markets Split: Tech & China Drag Down Region, Japan Surges on 'Takaichi Trade'

Market snapshot: A turbulent morning for Asia-Pacific equities as a 'triple threat' of US government shutdown fears, contractionary China manufacturing data (NBS PMI 49.3), and a reported rift between NVIDIA and OpenAI rattled sentiment. While the KOSPI plunged 1.8% on tech weakness, Japan's Nikkei 225 bucked the trend, rising 1.27% on bets of continued fiscal stimulus.

Summary: Global risk-off sentiment hits Asia. KOSPI drops 1.8% on NVIDIA-OpenAI funding halt news. China factory activity contracts. Japan outlines outlier gains on policy hopes.

Key Takeaways

• China Weakness: Official NBS Manufacturing PMI fell to 49.3 in Jan '26, signaling contraction.
• AI Capex Jitters: Reports of NVIDIA halting OpenAI funding triggered a 1.8% sell-off in KOSPI (memory proxy).
• Japan Decouples: The 'Takaichi Trade' (loose money, fiscal expansion) pushed Nikkei up 1.27% despite global headwinds.

SAHI Perspective

The divergence is stark. The NVIDIA/OpenAI news is a critical signal for Indian IT and global tech; if the AI alliance fractures, hardware capex could pause, impacting valuation multiples. Meanwhile, Japan remains the only major hedge in Asia, driven by Prime Minister Takaichi's aggressive liquidity stance. For Indian investors, this global volatility suggests a defensive rotation may be prudent until the US shutdown resolves.

Closing Insight

Volatility is back. The correlation breakdown between US tech sentiment and Japanese equities offers a rare diversification window, but the core AI growth engine is sputtering.

High Performance Trading with SAHI.