Global investors are redirecting funds back into Asian technology stocks, particularly those linked to artificial intelligence (AI), as geopolitical tensions in the Middle East show signs of easing.
Bloomberg reported, that equities in Taiwan and South Korea attracted a combined US$7.9 billion in net foreign inflows this week, marking a reversal after more than a month of sustained outflows.
While the inflows remain relatively modest compared to the record US$70 billion withdrawal seen in March, the shift signals renewed investor appetite for growth stocks, supported by improving earnings outlooks in the technology sector.
Among key drivers, Samsung Electronics reported a sharp surge in quarterly profit, rising eightfold and exceeding market expectations, reinforcing optimism around AI-driven demand.
Market analysts said the easing of geopolitical risks has allowed investors to refocus on structural growth themes such as AI.
“Investors believe the war is ending, so the key trade of Asian AI-related stocks is coming back,” said Vey-Sern Ling, Managing Director at Union Bancaire Privee.
Despite the renewed inflows, some caution remains. Concerns persist over the sustainability of the AI rally, particularly amid rising energy costs and the possibility that capital expenditure cycles may be peaking. Investment firm Jefferies Financial Group has also turned more cautious on South Korean equities.
Across the region, foreign fund flows remain uneven. India continues to experience sustained outflows, with US$17.8 billion withdrawn over 23 consecutive sessions through early April, reflecting its limited exposure to major AI players.
Meanwhile, Japan has also seen strong inflows, attracting about US$12 billion in the first week of April, supported by interest in semiconductor-related stocks such as Tokyo Electron.
In the broader market, shares of Taiwan Semiconductor Manufacturing Company have climbed 10% this week and are nearing record highs ahead of its upcoming earnings release. Other major chipmakers, including SK Hynix, have also posted strong gains, reflecting continued investor confidence in the AI growth story.
