Asia-Pacific stock markets continued their gains and headed for the best February in history. South Korea's stock index rose 18% on the month, but technology stocks came under pressure after Nvidia's earnings report.

By Long Yue, Zhang Yaqi

Source: Wall Street CN

Asian stocks extended their strong rally, heading for the best February performance on record. The MSCI Asia Pacific Index rose 0.15% on the day and 6.3% for the month. South Korea’s Kospi jumped 18% this month and 46% year-to-date. The “pick‑and‑shovel” logic of AI infrastructure has pushed Asia Pacific to outperform U.S. stocks for a third straight month. However, markets reacted coolly to Nvidia’s earnings, with Asian tech stocks retreating and U.S. stock futures falling on the day. U.S. Treasury yields held near 4%, and gold was on track for its longest monthly winning streak since 1973.

In February 2026, global stock markets saw a historic divergence: both Asian and European equities posted strong gains, sharply outperforming major U.S. benchmarks. The “AI fear trade” is reshaping global investors’ asset allocation, driving capital from the U.S. toward Asia and other markets seen as beneficiaries of the artificial intelligence supply chain.

Data showed the MSCI Asia Pacific Index has advanced about 7.1% this month, its strongest February performance since the gauge’s launch in 1998. A major European benchmark rose 3.6%, on track for an eighth consecutive monthly gain — the longest winning streak in nearly 13 years.

Among them, South Korea’s Kospi has rallied roughly 20% this month and 49% year-to-date, ranking among the world’s best-performing major indices. In contrast, U.S. stock indices have mostly fallen in February, with stock futures pointing to further downward pressure on Friday.

Asset managers overseeing more than $20 trillion globally have shifted stance en masse, turning more optimistic on emerging-market equities, currencies, local bonds and credit assets, injecting fresh momentum into the record-setting rally.

According to Bloomberg, after reviewing public market outlooks from the world’s largest asset managers, Citigroup found that funds have increased long positions in Asia, Latin America, Europe, the Middle East and Africa.

Meanwhile, even as Nvidia’s latest earnings beat expectations on revenue, net income and guidance, the market response remained muted, further weighing on U.S. stock sentiment and reflecting deepening investor concerns over the disruptive impact of artificial intelligence.

South Korea’s Kospi turned higher, erasing an earlier 2.4% drop, supported by continued gains in Hyundai Motor.

S&P 500 futures fell 0.4%. Japan’s Topix rose 0.4%. Euro Stoxx 50 futures were little changed.

U.S. Treasuries held gains, with the 10-year yield hovering around 4%. Australia’s 10-year yield dropped 5 basis points to 4.65%.

The U.S. dollar index was flat. The euro was little changed at $1.1794. The yen rose 0.1% to 155.95 per dollar. Offshore yuan fell 0.2% to 6.8575 per dollar.

Spot gold rose 0.2% to $5,192.81 an ounce. Gold gained more than 6% in February, on track for a seventh straight monthly advance — the longest such streak since 1973.

New York silver surged 4.0% on the day to $91.12 an ounce; spot silver gained 2.5% to $90.35 an ounce.

Bitcoin edged down to $67,288.68, and Ethereum fell to $2,018.49.

WTI crude fell 0.4% to $64.98 a barrel.

## Asian stocks head for best February ever, led by South Korea

The strong rally in Asian stocks this month is underpinned by a clear investment theme.

Amid the massive expansion of artificial intelligence infrastructure, investors view Asian companies as the “picks and shovels” — providers of core hardware and infrastructure — and have rushed to buy them.

This stands in sharp contrast to persistent pressure on U.S. stocks due to worries over AI-driven disruption.

As a bellwether for AI hardware investment, South Korea has been the biggest beneficiary. The Kospi has jumped roughly 20% this month and 49% year-to-date, making it the world’s best-performing major index so far in 2026.

“We are also seeing constructive shifts in positioning: global investors are gradually increasing their allocations to Asia,” said Rajeev De Mello, global macro portfolio manager at Gama Asset Management SA.

“Local investors in multiple markets are also rotating into domestic equities, seeking relative stability amid higher volatility in U.S. assets.”

Tim Waterer, market analyst at KCM Trade, stated plainly:

“Asian equities have undoubtedly become the global focus in 2026, especially when contrasted with the meager returns of major U.S. benchmarks. We are seeing a sustained rotation of global capital into regional tech stocks.”

## Nvidia earnings fail to ease AI worries, tech stocks under pressure

Tech stocks were the worst performers in Asian markets on Friday, following declines on Wall Street benchmarks and dampened sentiment from the muted reaction to Nvidia’s results.

Hardika Singh at Fundstrat Global Advisors said the calm market response to Nvidia — despite beats in revenue, profit and guidance — partly reflected that investors have become accustomed to such strong results.

“But it failed to alleviate concerns over its narrowing moat in an evolving computing world, and did not lay out its game plan for an AI‑disrupted world that could upend everything from cybersecurity to food delivery to banking,” she said.

## AI news continues to drive after-hours trading

Meanwhile, AI-related news continued to roil markets even after the New York close.

Jack Dorsey’s payments firm Block Inc. surged more than 20% in after-hours trading following news it would cut nearly half its workforce — about 4,000 jobs — to pivot toward AI.

Dell Technologies also jumped sharply in extended trading after raising its outlook for AI server sales.

## Other assets: gold extends rally, U.S. yields hit year-to-date lows

Elsewhere, U.S. Treasuries held gains, with the 10-year yield around 4%. It briefly touched its lowest level of the year during the U.S. session.

Earlier on Friday, Australia’s 10-year yield fell 5 basis points to 4.65%. The U.S. dollar traded mixed.

Oil prices stabilized after the U.S. and Iran agreed to hold more nuclear talks next week, following a round of discussions on Thursday. Markets remained tense amid heavy U.S. military deployments in the Middle East.

Gold was set for its longest monthly winning streak since 1973, with a gain of more than 6% in February marking seven straight months of increases.

In Japan, a key measure of core inflation in Tokyo slowed to the lowest level in more than a year, as utility subsidies introduced by Prime Minister Fumio Kishida capped household energy costs. The yen strengthened slightly on Friday.

### Risk Warning & Disclaimer

Markets are risky and investments require caution. This article does not constitute personalized investment advice and does not account for individual investors’ specific investment objectives, financial situations or needs. Investors should consider whether any opinion, view or conclusion in this article is suitable for their particular circumstances. Any investment decisions made are at your own risk.