68,000: Nikkei 225 hits fresh record highs due to tech rally

Asian equities performed mixed as traders adopted caution while monitoring US–Iran talks, with mixed signals from both sides keeping geopolitical uncertainty elevated. US Central Command (CENTCOM) announced Tuesday that it successfully defeated a series of Iranian missile and drone strikes targeting Kuwait and Bahrain. In response to the regional aggression, US forces also executed self-defense strikes against military targets on Iran’s Qeshm Island, per ABC News.

During the Asian hours, Japan’s Nikkei 225 rose 2.5% and closed at 68,402 on Wednesday. China’s SSE Composite Index gained 0.22% and closed at 4,083. However, Hong Kong’s Hang Seng declined by 1.65% ended day at 25,608. KOSPI closed amid a public holiday in South Korea, as it is designated as Local Election Day.

The Nikkei 225 Index crossed the historic 68,000 mark for the first time, setting a fresh record high driven by a relentless tech rally. Investor enthusiasm for artificial intelligence infrastructure easily eclipsed geopolitical anxieties regarding stalled US–Iran peace talks.

Japanese tech firms remain central to the global AI buildout, positioning them as primary beneficiaries of the sector's exponential growth. Market leaders Tokyo Electron (chipmaking equipment) and Advantest (semiconductor testing) spearheaded the day's gains.

Hong Kong’s Hang Seng Index pulled back as investors locked in profits following a recent AI-fueled rally. The tech sector, which led yesterday's surge, spearheaded the decline, dragging down financial and retail shares in its wake.