Asian stocks rebound after AI rout

Asian equities were mostly higher Monday following last week's rout in artificial-intelligence stocks, though sentiment remains fragile after Nvidia initiated an investigation into reports that Chief Executive Jensen Huang has been the target of a foreign espionage effort.

Brutal stock losses last week had prompted both South Korean and Taiwanese authorities to intervene to stem losses in local equities.

Taiwan's Taiex advanced 4.9% on Monday after tumbling more than 4% on Friday. Japan's Nikkei Stock Average gained 2.5% and Hong Kong's Hang Seng Index was up 0.1%.

South Korea's Kospi seesawed between mild gains and losses and was last 0.3% lower at 5046.53. Heavyweight chip makers SK Hynix and Samsung Electronics rose 2.3% and 1.75%, respectively. Markets in Singapore and Malaysia were closed Monday for a holiday.

Markets have calmed somewhat after initial shocks regarding concerns that a Democrat-led Congress could slow AI data-center expansion. "The AI revolution is coming one way or another," said Yorkville Ives analysts in a note, adding that markets grew overly pessimistic on the AI build-out last week.

The U.S. and China tech rivalry could be another engine driving continued AI infrastructure investment, analysts said.

"Remember, China will take any Data Center that we don't want, and pay lots of money for it," President Trump posted on Truth Social on Sunday.

However, Nvidia's probe threatens to destabilize an already highly sensitive AI sector. This will likely spark multiple congressional inquiries at a minimum and create an overhang on the stock, said Yorkville Ives analysts. Whether Huang remains CEO is the critical question for investors, they noted.

Oil prices swung in a choppy session amid uncertainty over developments in the Middle East conflict following initial cheer after the U.S. midterm elections last week.

Trump told CNN in an interview that renewed strikes were "highly unlikely" as long as there was progress in negotiations regarding Tehran's nuclear program and the reopening of the Strait of Hormuz.

However, Iranian Foreign Minister Abbas Araghchi said there has been no progress in talks with the U.S. and that Tehran is waiting to see if Washington's position shifts after the midterms.

The fact that supply and demand dynamics in the oil market have not materially changed in the past week means that the fall in oil prices largely reflects the risk premium narrowing, said Hamad Hussain, economist at Capital Economics.

Front-month West Texas Intermediate futures were down 0.5% at $90.44 a barrel, while front-month Brent futures were 1.0% lower at $97.30 a barrel.

Lower oil prices have continued to boost investor appetite for precious metals. Spot gold rose 1.4% to $4,214.24 a troy ounce and spot silver gained 2.0% to $52.93 a troy ounce.